Levi Strauss (LEVI.US) stock erased early gains and fell more than 5.0% on Thursday despite the denim retailer posting better than expected first-quarter figures.
- Company earned 46 cents per share topping analysts’ estimates of 42 cents per share. The apparel maker’s revenue of $1.59 billion also beat market projections of $1.55 billion amid robust demand for its jeans, tops and jackets. Levi was also able to increase prices while cutting down promotions.
- Americas division sales rose 26% thanks in part to "strength" in company-operated stores as consumers returned to in-person shopping.
- "The ongoing consumer demand across our portfolio of brands and our proven ability to deliver profitable growth give us the confidence to reaffirm our full-year outlook despite the incremental headwinds from ongoing macro challenges," Chief Financial Officer Harmit Singh said in a statement.
- For the current fiscal year denim retailer projects sales growth in the region from $6.4 billion to $6.5 billion, and an adjusted EPS between $1.50 and $1.56.
- Last month Levi Strauss decided to temporarily suspend most of its commercial operations in Russia following the invasion of Ukraine and is taking into consideration impairment of its Russian assets worth approximately 34 million.
Levi Strauss (LEVI.US) stock has been moving within a descending channel in recent months. At the end of March downward move intensified after buyers made an unsuccessful attempt to break above the major resistance zone at $21.35 which is marked with the upper limit of the 1:1 structure, 50 SMA ( green line) and upper boundary of the aforementioned channel. Currently price is approaching strong support at $17.45 which coincides with 61.8% Fibonacci retracement of the upward wave launched in March 2020 and lower limit of the 1:1 structure. Source: xStation5
