What happened with LEVI today?
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Uses news and trading volume to explain the day’s move and how it relates to the market.
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Levi Strauss & Co.’s business centers on the Levi’s brand, which supplies nearly all its revenue. Denim bottoms account for most sales, and core products such as the 501 jean make up the majority of Levi’s brand revenue. The company also sells tops and other clothing for men, women and children.
Retailers buy its products wholesale to resell to shoppers, while consumers buy directly through company-operated stores, outlets and websites such as levi.com. Wholesale and direct sales contribute similar shares of revenue; physical stores account for most direct sales. Most revenue comes from outside the United States, and no single wholesale customer dominates sales.
The company relies on independent manufacturers for nearly all its products. It must plan production before seasonal demand is clear: excess stock can require discounts, while shortages can cost sales. Cotton prices affect product costs, and sanctions and customs restrictions on certain materials and suppliers constrain where it can source goods.
The risk section is the longest, dullest part of the filing. This keeps only what can really hurt you: where it hits, how hard, when it plays out.
Every company claims an edge. Each one is checked against hard numbers like margins and returns: which hold, and which line gives way first.
Kontoor Brands, Inc. competes directly with Levi Strauss for jeans shoppers and retailers’ shelf space through Wrangler and Lee, selling to both retailers and consumers. Watch Wrangler and Lee sales for a read on the competition facing Levi’s core jeans business.
Gap Inc. competes with Levi Strauss for casual-clothing shoppers through Gap and Old Navy, and for premium women’s activewear shoppers through Athleta against Beyond Yoga. Its store and online sales at Athleta offer a focused view of the competition facing Beyond Yoga.
PVH Corp.’s Calvin Klein and Tommy Hilfiger compete with Levi Strauss in jeans and casual clothing, selling to retailers and directly to shoppers worldwide. Sales through those brands’ retail partners, stores and websites show the competition Levi’s faces across both routes to customers.
Ralph Lauren Corporation competes with Levi Strauss for branded lifestyle clothing purchases through stores, online sales and sales to retailers, but sits further upmarket. Its apparel sales offer a view of competition at the higher-priced end rather than a direct comparison with Levi’s jeans business.
V.F. Corporation and Levi Strauss both depend on worldwide demand for lifestyle brands, selling branded clothing and related products to retailers and through their own stores and websites. VF’s sales to retail customers provide a useful read on the wholesale demand that also matters to Levi Strauss.
G-Iii Apparel Group Ltd and Levi Strauss compete for overlapping retail buyers and consumers of men’s and women’s branded clothing. G-III designs and sources products such as outerwear, dresses and sportswear, making its sales to retail buyers a useful place to watch competition beyond jeans.
Kontoor Brands, Inc. earningsKTB
Kontoor Brands, Inc.’s report will show how Wrangler and Lee jeans are selling, offering a read on the competition Levi Strauss faces for shoppers and retailers’ shelf space.
Read Wrangler and Lee sales against Levi Strauss’s business, where jeans make up most units sold. Steady sales at Kontoor suggest shoppers and retailers still support jeans; a decline points to more pressure on Levi Strauss to win the same customers and shelf space.
Retail Sales MoM (Oct)
Retail sales track how much consumers spend at stores and online; stronger sales can support demand for Levi’s jeans and other apparel, lifting Levi Strauss & Co.’s wholesale orders and sales through its own stores and e-commerce sites.
If retail sales are strong, consumers are spending more, which could support Levi’s apparel orders from retailers and sales at Levi Strauss & Co.’s own stores and e-commerce sites; if sales are weak, those orders and direct sales could soften, with more discounting needed to clear inventory.
