Company Overview
Levi Strauss & Co. operates as a global leader in the design, marketing, and sale of apparel and related accessories for men, women, and children across the United States and international markets. The company focuses its product portfolio on specific categories including jeans, casual and dress pants, activewear, tops, shorts, skirts, dresses, jumpsuits, shirts, sweaters, jackets, footwear, and other related items. This entity functions within the Consumer Cyclical sector and specifically within the Apparel Manufacturing industry, positioning it as a business whose performance is closely tied to discretionary consumer spending and fashion trends. The company demonstrates a significant market presence with a total market capitalization of $7.13B and generates annual revenue reaching $6.28B while employing approximately 19,000 individuals globally. These valuation and revenue figures indicate that Levi Strauss & Co. maintains a substantial operational footprint and holds a notable position within the competitive landscape of global apparel manufacturing, distinguishing it as a large-cap entity with established distribution networks.
Financial Health
Levi Strauss & Co. reported a trailing twelve-month revenue of $6.28B and a corresponding net income of $502.00M, while generating an EBITDA of $924.70M. The substantial gap between the $6.28B revenue and the $502.00M net income reveals a cost structure where operating expenses, including cost of goods sold, administrative costs, and other deductions, consume a significant portion of total sales to arrive at the final profit. The company generated $355.41M in free cash flow, which indicates a robust ability to generate cash beyond the capital required for operations, providing financial flexibility for capital allocation, debt repayment, or potential share buybacks. Profitability efficiency is highlighted by three distinct margins: a gross margin of 61.7%, an operating margin of 12.2%, and a profit margin of 9.2%, each reflecting the company's ability to control production costs, manage overhead effectively, and deliver earnings to shareholders. Regarding liquidity and leverage, the company holds $848.80M in cash against $2.31B in total debt, resulting in a debt-to-equity ratio of 101.18, which suggests a leveraged balance sheet where debt obligations exceed equity capitalization. Short-term liquidity is supported by a current ratio of 1.55, indicating that the company possesses 1.55 times more current assets than current liabilities to meet its short-term obligations. Management effectiveness is further evidenced by a return on equity of 23.6% and a return on assets of 6.8%, metrics that demonstrate the company's capability to generate significant returns on shareholder investments relative to its total asset base.
Valuation Assessment
The stock trades with a trailing P/E ratio of 14.49 and a forward P/E of 11.07, and the difference between these two metrics implies that the market expects earnings growth in the future relative to the current earnings base. The price-to-book ratio stands at 3.13, indicating that the market values the company at more than three times its book value, suggesting a market premium over the net asset value recorded on the balance sheet. Alternative valuation metrics provide additional context, with a price-to-sales ratio of 1.13 and an EV/EBITDA of 9.29, which suggest the company is priced at slightly more than one dollar of sales and offers earnings value relative to enterprise value at a level comparable to peers in the sector. The stock has experienced a trading range between a 52-week low of $12.17 and a 52-week high of $24.82, and without the current share price explicitly listed in the provided facts, the specific percentage distance from these bounds cannot be calculated, though the range defines the recent volatility envelope. The beta of 1.29 indicates that the stock's price volatility is higher than the broader market, meaning the stock tends to move with greater intensity than the overall market index during periods of rising or falling prices.
Growth & Income
The company's financial trajectory shows a revenue growth of 0.9% year-over-year contrasted with an earnings growth of -13.4% year-over-year, revealing that earnings are currently declining at a significantly faster rate than revenue, which implies rising costs or margin compression despite stable top-line sales. As a dividend payer, the company offers a dividend yield of 3.1% with a payout ratio of 42.9%, and this payout ratio suggests that the dividend is sustainable as it covers less than half of the earnings generated, leaving ample room to maintain the payout even if earnings fluctuate. The combination of modest revenue expansion and negative earnings growth alongside a moderate payout ratio presents a mixed profile where income generation is prioritized over aggressive earnings expansion in the current fiscal period. Overall, the growth and income profile reflects a mature business phase characterized by steady revenue, declining earnings, and a commitment to returning capital to shareholders through dividends rather than aggressive reinvestment for rapid expansion.