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Levis


MickinMD

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Back in the '70's. Levi's jeans ruled!  My first new car was a 1977 AMC Gremlin - one of the first attempts at a true SUV and mine had Levi's interior - denim seats, walls and ceiling! Wearing the expensive Levi's jeans was a fashion statement back then.

Levi's were so coveted worldwide and hard to get outside the USA that they commanded very high prices.  I had two friends that packed four suitcases with Levi's jeans they bought in Maryland and then sold them for three or four times the amount in Europe to help pay for a summer vacation there.

Why do I bring them up now?

Levi's, which went private as a company 34 years ago, has returned as a public company to the stock market today.  The insiders who were able to buy the shares at the IPO (Initial Public Offering) of $17/share can sell them at $22.48 right now and make a 32% profit for several hours of ownership.

If this was happening in the 70's, I'd jump in even at $22.48.  But, just like Coors Beer, Levi's isn't the great name it was in the 70's.

Warren Buffett gave an interview last week on the problems he has had after he arranged for a Brazilian company to acquire Kraft and Heinz and Buffett's Berkshire-Hathaway owned a significant part of it all.  He said it's not clearly a mistake yet, especially with Heinz, but he said brand names are becoming less and less the big deal they used to be and it's hard even for Kraft-Heinz to get shelf space a Walmart, etc. without a big price discount.

Part of the problem is that the modern way to for brand names to increase profits is to see how far they can decrease the size or quality of their products before people bolt. For example, Levi's used to have steel rivets at key points in their Jeans. No more. Tuna used to be in 6 oz. cans now they're 5 oz. - in clear collusion!  Any wonder that Costco's Kirkland brand, a 7 oz. can, sells for more than Bumble Bee?  Buffett pointed out that the store brands like Kirkland and Walmart's Great Value are building strong customer loyalty.

So, with my stocks doing very well today - General Mills is up 4% today and 30% for 2019 a few months after the "experts" screamed "Sell!" - and half on my other stock up 1.8 to 2.8% today, I'm not going to roll-the-dice with Levi's.

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3 minutes ago, MickinMD said:

Back in the '70's. Levi's jeans ruled!  My first new car was a 1977 AMC Gremlin - one of the first attempts at a true SUV and mine had Levi's interior - denim seats, walls and ceiling! Wearing the expensive Levi's jeans was a fashion statement back then.

Levi's were so coveted worldwide and hard to get outside the USA that they commanded very high prices.  I had two friends that packed four suitcases with Levi's jeans they bought in Maryland and then sold them for three or four times the amount in Europe to help pay for a summer vacation there.

Why do I bring them up now?

Levi's, which went private as a company 34 years ago, has returned as a public company to the stock market today.  The insiders who were able to buy the shares at the IPO (Initial Public Offering) of $17/share can sell them at $22.48 right now and make a 32% profit for several hours of ownership.

If this was happening in the 70's, I'd jump in even at $22.48.  But, just like Coors Beer, Levi's isn't the great name it was in the 70's.

Warren Buffett gave an interview last week on the problems he has had after he arranged for a Brazilian company to acquire Kraft and Heinz and Buffett's Berkshire-Hathaway owned a significant part of it all.  He said it's not clearly a mistake yet, especially with Heinz, but he said brand names are becoming less and less the big deal they used to be and it's hard even for Kraft-Heinz to get shelf space a Walmart, etc. without a big price discount.

Part of the problem is that the modern way to for brand names to increase profits is to see how far they can decrease the size or quality of their products before people bolt. For example, Levi's used to have steel rivets at key points in their Jeans. No more. Tuna used to be in 6 oz. cans now they're 5 oz. - in clear collusion!  Any wonder that Costco's Kirkland brand, a 7 oz. can, sells for more than Bumble Bee?  Buffett pointed out that the store brands like Kirkland and Walmart's Great Value are building strong customer loyalty.

So, with my stocks doing very well today - General Mills is up 4% today and 30% for 2019 a few months after the "experts" screamed "Sell!" - and half on my other stock up 1.8 to 2.8% today, I'm not going to roll-the-dice with Levi's.

Have you read the story of Levis and Walmart? 

https://www.cio.com/article/2439956/supply-chain-partnerships--how-levi-s-got-its-jeans-into-wal-mart.html?page=2

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