Economists and analysts predict a favorable outcome concerning the denim industry. This prediction is a piece of exciting news for Levi Strauss & Co. which may launch an IPO in 2019.
CBC reported the news on Levi Strauss going public in the first quarter of 2019 in November. There is a target valuation of $5 billion. The Tokyo Stock Exchange already has the public trade of Levi’s Japanese subsidiary.
Despite the news, the company has not released a definitive statement yet.
The overall apparel industry gives insight into the reign of denim sales. Studies conducted have revealed that the denim industry had a 5% growth, compared to the NPD Group’s 1% growth.
The 2018 report on Levi Strauss’ revenue revealed the amount of $1.39 billion. The denim company releases quarterly earnings due to its public listing of debt.
Years before, the denim industry was declining. The athleisure trend peaked and people were buying leggings, yoga pants, and sweats. In the past months, there seems to be a shift and swing towards the denim apparel again.
Jay Sole, a UBS analyst, mentioned that things are looking up for the denim industry. There is a changing trend when it comes to athleisure or performance apparel.
Levi’s was one of the most iconic brands of the 1980s to 1990s. Analysts believe that the streetwear and memories of these periods urge the public to bring back certain fashions. The 90s revival is putting spandex and skinny jeans to rest.
A Macquarie Capital analyst, Laurent Vasilescu, declared that Levi’s IPO has an advantage if the denim cycle will come back again. If it does not, consumers need to wait for at least two years to purchase a new pair of jeans.
Aside from Levi’s IPO, the VF Corp that owns denim brands Wrangler and Lee has plans on getting into the public market again. This plan was announced in August 2018. Part of this plan is the launching of a brand new spinoff company Kontoor Brands. It aims to help the company raise the status of Vans and The North Face.
Kontoor Brands will be done in March. The VF Corp submitted the paperwork necessary to the Securities and Exchange Commission about two months ago. News in January revealed that the partial shutdown of the federal government might lead to the delay of the spinoff brand’s debut.