Apparel & Other Finishd Prods of Fabrics & Similar Matl
Levi Strauss & Co. engages in the design, marketing, and sale of apparels and related accessories for men, women, and children in the Americas, Europe, and Asia. It offers jeans, casual and dress pants, activewear, tops, shorts, skirts, dresses, jumpsuits, shirts, sweaters, jackets, footwear, and related products under the Levi's, Dockers, Beyond Yoga, Signature by Levi Strauss & Co., and Denizen brands. The company also licenses Levi's and Dockers trademarks for various product categories, including footwear, belts, wallets, bags, outerwear, sweaters, dress shirts, kids wear, sleepwear, and hosiery. In addition, it sells its products through third-party retailers, such as department stores, specialty retailers, third-party e-commerce sites, and franchisees who operate brand-dedicated stores; and directly to consumers through various formats, including company-operated mainline and outlet stores, company-operated e-commerce sites, and select shop-in-shops located in department stores, and other third-party retail locations. Further, the company operates approximately 3,200 brand-dedicated stores and shop-in-shops. The company was founded in 1853 and is headquartered in San Francisco, California.
Discounted Cash Flow Valuation of Levi Strauss & Co
Growth
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Discount
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Multiple
g\r | +10% | +11% | +12% | +13% | +14% |
---|---|---|---|---|---|
0% | 10 | 9 | 8 | 8 | 7 |
+1% | 11 | 10 | 9 | 8 | 8 |
+2% | 13 | 11 | 10 | 9 | 8 |
+3% | 14 | 13 | 11 | 10 | 9 |
+4% | 17 | 14 | 12 | 11 | 10 |
Years | 0 | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | TV |
---|---|---|---|---|---|---|---|---|---|---|---|---|
FCF | $606.1M | $674.5M | $746M | $819.8M | $895.2M | $971.3M | $1.047B | $1.121B | $1.193B | $1.261B | $1.324B | $13.24B |
DCF | $586.6M | $564.1M | $539.1M | $511.8M | $482.9M | $452.7M | $421.5M | $390M | $358.5M | $327.3M | $3.273B | |
Value | $7.907B |
In the chart Earnings are multiplied by this value.
High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.
Years | 11-2015 | 11-2016 | 11-2017 | 11-2018 | 11-2019 | 11-2020 | 11-2021 | 11-2022 | 11-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Net Margin | 4.7% | 6.4% | 5.7% | 5.1% | 6.8% | -2.9% | 9.6% | 9.2% | 4% | 2.1% |
ROA | 15% | 16% | 14% | 16% | 13% | -1.5% | 12% | 11% | 5.8% | 3.3% |
ROE | 63% | 57% | 40% | 42% | 25% | -9.8% | 33% | 30% | 12% | 6.3% |
The average Net Margin over the past 5 years is +5.32%.
The trend of Net Margin over the past 5 years is +0.41%.
The average ROA over the past 5 years is +9.3%.
The trend of ROA over the past 5 years is -1.26%.
The average ROE over the past 5 years is +22.18%.
The trend of ROE over the past 5 years is -2.68%.
Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.
Years | 11-2015 | 11-2016 | 11-2017 | 11-2018 | 11-2019 | 11-2020 | 11-2021 | 11-2022 | 11-2023 | TTM |
---|---|---|---|---|---|---|---|---|---|---|
Debt FCF | 9.65 | 5.13 | 2.65 | 4.03 | 4.28 | 4.61 | 1.80 | -25.94 | 8.52 | 1.67 |
Debt Equity | 3.37 | 2.04 | 1.53 | 1.58 | 0.65 | 1.20 | 0.62 | 0.53 | 0.50 | 0.51 |
MIN | ||||||||||
Graham Stability | - | - | 100% | 100% | 100% | -40% | 100% | 100% | 75% | -40% |
The Debt/FCF trailing twelve month is 1.67.
The trend of Debt/FCF over the past 5 years is -2.03.
Graham’s Stability measure stands at -0.40.
Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.
Years | 11-2016 | 11-2018 | 11-2020 | 11-2022 | Trend |
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Revenue | 4.5% | 2.1% | 12% | 0.17% | 0.78% |
Net Income | -2.2% | -2.5% | - | -56% | -13% |
Stockholders Equity | 22% | 25% | 16% | 7.5% | -9.7% |
FCF | -7.3% | -14% | -29% | - | 4% |
The Revenue CAGR over the past 5 years is +2.08%.
The trend of Revenue growth rate over the past 5 years is +0.78%.
The Earnings CAGR over the past 5 years is -2.49%.
The trend of Earnings growth rate over the past 5 years is -12.61%.
The Equity CAGR over the past 5 years is +25.12%.
The trend of Equity growth rate over the past 5 years is -9.66%.
The FCF CAGR over the past 5 years is -14.39%.
The trend of FCF growth rate over the past 5 years is +4.02%.