Levi Strauss (LEVI) Stock: Wall Street Lowers Expectations Before Quarterly Report

Key Takeaways

• Jefferies reduced Levi Strauss (LEVI) price objective to $25 from $27, maintaining its Buy recommendation.
• Stifel decreased its price target to $27 from $28 due to revenue uncertainty, while preserving its Buy stance.
• Levi Strauss shares currently trade at $19.70, reflecting a 0.25% decline for the session.
• The company’s quarterly results arrive in six days, with UBS projecting Q3 EPS at $0.36.
• Levi Strauss recently reported a cybersecurity breach that compromised internal files through unauthorized access.

Shares of Levi Strauss & Co. (LEVI) currently hover at $19.70, experiencing a slight 0.25% pullback. This week, a pair of prominent Wall Street firms have revised their price expectations downward as the denim giant prepares to unveil its quarterly performance.

Levi Strauss & Co., LEVI

Jefferies has adjusted its price objective to $25, down from a previous $27 mark. Despite the reduction, the firm continues to recommend the stock as a Buy.

Stifel followed suit with its own downward revision, bringing its target to $27 from $28. Like Jefferies, Stifel retained its positive Buy recommendation on the shares.

The apparel company’s earnings announcement is scheduled for six days from now. Both investment firms have recalibrated their forecasts with this imminent release in consideration.

Jefferies anticipates a robust third-quarter performance in general. The firm highlights the company’s impressive gross profit margin of 61.72% as a key strength.

The full-year profit forecast might see a modest upward adjustment, Jefferies suggests. However, revenue projections are likely to remain stable due to persistent inflationary headwinds affecting consumer spending.

Reasons Behind the Price Target Adjustments

Jefferies identified challenges in the European marketplace and potential weakness among U.S. value-conscious shoppers. The firm’s proprietary data tracking U.S. sales performance showed inconsistent signals.

Stifel’s rationale differs somewhat from its competitor. The firm recalibrated its revenue and profit forecasts based on industry channel feedback and cotton commodity pricing that will impact margins through 2027.

Despite the adjustment, Stifel’s earnings predictions remain above Wall Street’s consensus figures for both 2026 and 2027. Its margin analysis incorporates potential tariff protection and enhanced direct-to-consumer profitability.

The firm views the current denim fashion cycle, particularly wide-leg silhouettes, as still expanding. Levi Strauss appears well-positioned to capitalize on this trend given its market leadership in the category.

Retail partner commentary has been encouraging, according to Stifel. However, alternative sales tracking data suggests softer results, which the firm attributes to macroeconomic uncertainty and increased competition for discretionary spending.

Market Valuation and Financial Outlook

Levi Strauss shares currently trade at a price-to-earnings multiple of 12.5 times based on fiscal 2026 projections. This represents a discount compared to the lifestyle apparel sector median of 14.3 times for calendar 2026.

Stifel’s revised $27 price objective translates to 15.5 times its fiscal 2027 earnings forecast of $1.74 per share. The broader analyst community consensus stands at $1.71 for that same timeframe.

UBS has maintained a more optimistic position, retaining both its Buy rating and $34 price target. The firm anticipates third-quarter earnings of $0.36 per share, matching consensus expectations.

UBS additionally forecasts improved revenue trends that could prompt management to raise full fiscal 2026 EPS guidance. This outlook represents a notably more constructive view than that of the other two firms.

Jefferies also acknowledged the recent appointment of a new chief financial officer. The firm interprets this executive change as evidence of ongoing commitment to international expansion.

The investment bank views fourth-quarter results as a critical benchmark for operational efficiency. It anticipates revenue expansion in the mid-single-digit percentage range or better as the company moves into 2027.

On a separate note, Levi Strauss acknowledged a cybersecurity incident earlier this month. The company disclosed that unauthorized individuals gained access to internal documents through social engineering methods.

Management emphasized that no customer information was compromised in the security breach. External cybersecurity specialists have been engaged to conduct a comprehensive investigation.

The company’s board of directors experienced a recent change as well. Robert Eckert stepped down upon reaching the board’s mandatory retirement threshold, with the departure unrelated to any operational or strategic disputes.