Levi Strauss Jumps 8.6% as Q4 Results Meet Expectations

Shares of clothing brand Levi Strauss & Co. (NYSE: LEVI) rose 8.6% in after-hours trading on Wednesday after the company’s fiscal fourth-quarter results came in line with the Street’s estimate.

For the fourth quarter ended November 28, 2021, adjusted EPS more than doubled year-over-year to $0.41, just beating analysts’ expectations of $0.40.

Net revenues increased 22% year-over-year to $1.69 billion, almost in line with the consensus estimate of $1.68 billion.

Direct-to-Consumer (DTC) net revenues grew 25%, Wholesale net revenues rose 20%, and digital net revenues were up 2% year-over-year.

Adjusted gross margin stood at 58.1%, up 350 basis points, and adjusted operating margin expanded to 12% from 8.2% in the fourth quarter of 2020.

Chip Bergh, the President and CEO of Levi Strauss, said, “Today’s results reflect robust financial performance, marked by sequential improvement through the year, despite navigating ongoing business disruption from the pandemic. Through it all, we have stayed focused on our future and our momentum continues to accelerate into 2022.”

“We are well-positioned for long-term, sustainable growth – our strong brand equity is driving pricing power, we’re boldly diversifying our business and continuing to expand our high margin DTC business,” Bergh added.

Outlook

For the Fiscal Year 2022, the company expects net revenues to range from $6.4 billion to $6.5 billion and adjusted EPS between $1.50 and $1.56.

The Street expects Levi Strauss to report net revenues of $6.38 billion and adjusted EPS of $1.53.

About Levi Strauss

California-based Levi Strauss designs, manufactures, and sells jeans, casual and dress pants, tops, shorts, skirts, jackets, footwear, and related accessories. Its brands include Levi’s, Signature by Levi Strauss & Co., Denizen, Dockers and Beyond Yoga.

The company has nearly 3,100 retail stores and shop-in-shops spread in more than 110 nations across the world.

Stock Rating

Based on 4 unanimous Buys from top analysts, Levi Strauss has a Strong Buy consensus. The average LEVI stock forecast of $30.50 implies 50.1% upside potential from current levels. Shares have lost 23% over the past six months.

Website Traffic

TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (NYSE: SEMR), the world’s biggest website usage monitoring service, offers insight into Levi Strauss’ performance.

According to the tool, compared to the previous year, Levi Strauss’ website traffic registered a nearly 18% fall in global visits in December. Moreover, the website traffic has decreased 3.3% year-to-date against the same period last year.

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