Those who noticed that in October we haven’t written about quarterly reports yet get an A+ and, of course, interesting details of a financial statement from Levi Strauss for June-August 2021. In addition to that, you’ll get tech analysis of the American clothes manufacturer from Maksim Artyomov. So many interesting things here, we’re definitely spoiling you!

A quarterly report from Levi Strauss: the revenue skyrocketed by more than seven times

After the end of the trading session on Wednesday, October 6th, Levi Strauss, a popular clothing and footwear manufacturer, published its financial statement for the third quarter. We’ll tell you at the very beginning that the statistics were way better than expected.

The company explained an enormous upwards lead of the revenue received this summer with such factors as the audience’s positive response to a new collection of jeans, stable goods supplies, high demand caused by a pre-school season.

The COVID-19 pandemic-related manufacturing problems, which are currently “flooding” Vietnam, had no influence on the Levi Strauss business. The same can't be said for Nike, shares of which dropped over 6% in late September due to the difficulties with Vietnamese supplies.

In this country, the company established by Levi Strauss manufactures only 4% of the total volume of its goods. Actually, we should mention the company’s approach to cloth purchase and production job: to reduce risks of manufacturing and supply disruptions, Levi Strauss cooperates with factories from 24 countries.

Important data from the report

  • Revenue — $1.5 billion, +36%, forecast — $1.48 billion.
  • Return on share — $0.48, +500%, forecast — $0.37.
  • Net profit — $193 million, +615%.

Levi Strauss shares added 8.5%

On October 6th, while everyone was anticipating a report from the company, its shares closed the trading session by losing 5.13%, down to $24.24. However, the next day, the strong financial statement for June August 2021 made Levi Strauss (NYSE:LEVI) shares add 8.46% and reach $26.29.

Since the beginning of the year, the company’s shares added 23.6%, that’s over $6. In the first half of 2021, this value was even more impressive, $30.48, +34% if compared with the January data.

Tech analysis of Levi Strauss shares by Maksim Artyomov

“Influenced by its quarterly report and positive forecasts for the next accounting period, Levi Strauss shares started recovering. After rebounding from the 200-day Moving Average, the price has broken the resistance level and is currently trying to leave its sideways channel.

At the moment, the price is expected to move towards the upside border of the correctional channel, a breakout of which may result in further growth. In this case, the upside target will be at $30. If later the asset breaks this level, it may resume the uptrend and break local highs”.

Tech analysis of Levi Strauss shares for 08.10.2021

The next quarter forecast for Levi Strauss

The company is sure that the last months of the year will be successful. Such an optimistic approach is based on a traditionally high pre-New Year demand. Another thing to support this idea is “Beyond Yoga”, a brand recently acquired for $400 million.

The quarterly revenue is forecasted to add 20–21%. As for the return on a share, the company is expecting it to add $0.38–0.4. At the year-end, the net profit may expand by 27%, while the return on a share – $1.43–1.45.

Summing up

A quarterly report from Levi Strauss for June-August turned out to be way better than analysts expected and made the company’s shares rise by more than 8%. The revenue and the net profit added 36% and 615% respectively. The forecast for the next quarter of 2021 is also very optimistic: the revenue is expected to add 20–21%.

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He is the guru of searching for and demonstrating hidden opportunities and insights of the market. He writes about everything that might be of interest to the investor: stocks, currencies, indices, and various business spheres. Has been “in” since 2019.