Levi Approves $200M Share Buyback Plan; Analysts Remain Bullish


American clothing company Levi Strauss & Co. (LEVI) announced that its board of directors has approved a common stock repurchase program of up to $200 million of its Class A common stock.

Earlier, in January 2020, the board had approved a share buyback plan of up to $100 million. After repurchasing shares for $56.2 million, during the six months ended May 24, 2020, the share repurchase program was suspended.

Along with the buyback plan, the company has declared a quarterly cash dividend of $0.08 per share. The dividend is payable on November 17 to stockholders of record of Class A common stock and Class B common stock at the close of business on October 29, 2021. (See Analysts’ Top Stocks on TipRanks)

The company also reported better-than-expected third-quarter results, driven by the strength of the Levi’s brand, continued momentum in the business and the company’s ability to fight macro headwinds.

On September 27, UBS analyst Jay Sole reiterated a Buy rating on the stock and raised the price target to $37 (52.6% upside potential) from $36.

Last month, Wells Fargo analyst Ike Boruchow initiated coverage on LEVI with a Buy rating and a price target of $31 (27.9% upside potential).

Boruchow said, “With multiple margin tailwinds all gaining momentum at the same time (including DTC shift, increased focus on women’s, China model ramp-up, and e-comm profitability inflection), we believe a 14-16% margin is very much on the table for the business.”

Overall, the rest of the Street is bullish on the stock and has a Strong Buy consensus rating based on 10 unanimous Buys. The average Levi Strauss & Co. price target of $35.50 implies upside potential of about 45.6% from current levels.

Furthermore, Levi scores a “Perfect 10” from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.

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