Investors on Friday dumped Levi Strauss & Co.’s (LEVI) shares despite the denim jeans maker reporting better-than-expected third-quarter results and earning price target boosts from several Wall Street analysts. LEVI stock plunged by more than 11% to reach about $22 per share as of 2:14 p.m. EDT on Friday.
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The sell-off came as investors directed their focus on Levi’s warning that it expects its margin in the following quarter to reflect the impact of the Trump administration’s tariffs on the sector. The California-based company expects its fourth quarter gross profit margin to fall by about 130 basis points.
Levi Strauss Makes $1.5 Billion in Sales in Q3
During the three months ended in August, Levi had seen its sales expand by 7% to $1.5 billion, compared to the same period last year. The company also earned 34 cents per share, beating analysts’ expectations of 31 cents — the number rose 3% year-over-year.
Levi believes its direct-to-consumer strategy will continue to yield results, and therefore elevated its full-year guidance, expecting revenue to improve further by 3% at the end of Fiscal year 2025. CEO Michelle Gass also noted that the business was “well-positioned for the holiday season” and “will deliver sustained, profitable growth in 2026.”
Wall Street Upbeat about Levi Strauss
In reaction to the earning results, Wall Street analysts raised their price targets for LEVI stock with significant upsides. For instance, UBS analyst Jay Sole raised his price target from $28 to $32, keeping his Buy rating.
Similarly, JPMorgan analyst Matthew Boss elevated his price target to $33, from $23, maintaining his Overweight grade on the shares. Boss cited the earnings beat and the company’s conservative forecast.
However, Morgan Stanley analyst Alexandra Straton only slightly improved her price target from $19 to $20 per share, refusing to move her Equal Weight rank. Straton doubts if the company’s current growth rate can expand profit into 2026 and beyond.
Is LEVI a Good Stock to Buy Now?
Meanwhile, across the larger Wall Street, Levi Strauss’ shares currently enjoy a Strong Buy consensus recommendation, TipRanks’ data shows. This is based on nine Buys and three Holds assigned by 12 analysts over the past three months.
Moreover, the average LEVI price target of $26.27 hints at a possible 21% growth from the current level.
