Investors weren't thrilled with the latest earnings update out of Levi Strauss (NYSE: LEVI). The apparel specialist met management's sales targets in a tough selling environment, but Wall Street was looking for more.

The stock's decline following the report added to a tough year for shareholders. Levi shares are down 14% so far in 2023 compared to a 15% increase in the S&P 500. Let's take a look at whether that downturn represents a compelling value for investors seeking market-beating returns.

Sales trends weren't as bad as they might seem at a glance. Sure, revenue dropped 9% after having risen by 9% in the prior quarter. But this result was right in line with management's outlook. It also included a one-time negative impact from Levi's transition to a new enterprise resource planning platform. Adjust for that slump, and sales would have fallen by just around 2% in the period.

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Source Fool.com