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Levi Strauss (LEVI) Stock Pops on Q2 Earnings Beat, Dividend Raise

  • Levi Strauss (LEVI) stock is trending up this morning.
  • The company reported strong second-quarter earnings and raised its dividend 20% to 12 cents.
  • The initial reaction to this news was choppy, with up-and-down price action.
a stack of white t-shirts with the Levi's (LEVI) logo on them
Source: Papin Lab / Shutterstock.com

Levi Strauss (NYSE:LEVI) stock saw a pop, drop and then another pop early this morning. Traders on Wall Street evidently struggled to assess Levi Strauss’ second-quarter results, even though they were mostly positive.

Levi has had to deal with the hesitancy of shoppers amid rising inflation, so investors should consider its quarterly results with that context. All in all, the results and outlook appear encouraging, although not perfect.

Here’s the rundown. Levi Strauss increased its net revenue 15% year-over-year (YOY) to $1.5 billion in Q2. This represents a slight beat compared to the analyst consensus estimate of $1.4 billion. Digital net revenues were a notable highlight in the report, comprising around 20% of quarterly net revenue.

Turning to the bottom line, Levi Strauss earned 29 cents in adjusted diluted earnings per share (EPS). This compared favorably to 23 cents in the same period last year, as well as Wall Street’s estimate of 23 cents for Q2 2022.

What’s Happening with LEVI Stock?

This morning, LEVI stock moved up toward $17, lurched back toward $16, then repeated this tug-of-war several times. Perhaps, traders were concerned about the Q2 net income. At $50 million, net income fell short of last year’s $65 million.

Still, there’s no need to nitpick here. Levi Strauss delivered more positive data points than negative ones. Further, CFO Harmit Singh offered a bright long-term outlook. Singh assured investors that the company is on a “path to achieve net revenues of $9 to $10 billion and adjusted EBIT margin of 15% by fiscal year 2027.”

In the report, Levi Strauss also kept income-focused investors interested by raising its quarterly dividend 20%. To be more specific, the company increased its dividend from 10 cents per share to 12 cents, representing a total of around $48 million in dividend payouts to be made on Aug. 17, 2022.

LEVI stock did resolve slightly green an hour into today’s trading session, but there’s still plenty of time for Wall Street to say “yay” or “nay” today. As of this writing, shares are up by about 3%.

On the date of publication, David Moadel did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.


Article printed from InvestorPlace Media, https://investorplace.com/2022/07/levi-strauss-levi-stock-pops-on-q2-earnings-beat-dividend-raise/.

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