The stock price of Levi Strauss initially rose by 2.3% before settling back to $16.37, up 0.74%, following the upgrade to buy from neutral by Bank of America Merrill Lynch.
Amid the escalating trade war with China, Levi Strauss' brand strength will provide a key advantage in a "disrupted environment," the report noted.
CEO Chip Bergh recently told Reuters that Levi Strauss has been "deliberate and diligent" moving production out of China as tariff tensions have escalated.
Levi Strauss now makes just 1% or 2% of its products in China, down from 16% two years ago, Bergh told the news agency.
Bank of America Merrill Lynch analysts cited strong brand momentum, attractive valuation of Levi Strauss stock after some significant declines in 2019, as well potential upside for future sales.
However, the sharp decline in the U.S. department store sector has also "weighed on valuation," with old-fashioned mall stores still accounting for 18% to 20% of Levi sales, the analysts noted.
Taking this into account, the Bank of America Merrill Lynch lowered its price target for Levi Strauss stock to $20 a share, down from $25 previously.