Is the bear market finally over? It's too soon to say for sure. But we've seen enough glimmers of hope to believe we're closer to the beginning of the next bull market than not; it's certainly not too soon to start positioning for one.

With that as the backdrop, consider slipping into jeans brand Levi Strauss & Co. (LEVI -1.97%) as a top way to play the economic rebound on the horizon. Three key reasons this ticker is a great bet and stands out above the rest.

1. Strong economies boost discretionary spending

It's obvious, yet it needs to be said all the same -- consumers tend to splurge a little more when the economy is strong, wages are high, and unemployment is low.

That's not to suggest denim is hypersensitive to economic ebbs and flows. For all intents and purposes, jeans are the consumer staple of the apparel world. They're what we wear when we don't want to think about what to wear. Nevertheless, Levi Strauss is a premium brand that uniquely benefits from a strong economy.

Its e-commerce site even has a category of clothing called "premium," with price points as high as around $100 per garment. Then there's the so-called "Yellowstone effect," or raised demand for Western wear, prompted by the hit TV show Yellowstone, set in Montana's farming and ranching landscape.

Several pairs of denim jeans on hangars.

Image source: Getty Images.

The company's looking beyond denim, too. Levi Strauss is also parent to Beyond Yoga and Dockers, both of which also benefit from the same economic growth that tends to drive bull markets. The very first Beyond Yoga store was opened in October, deepening its reach into the athleisure sliver of the apparel arena.

These and other initiatives are why the company is guiding for 2023 revenue of between $6.3 billion and $6.4 billion, up from last year's $6.2 billion.

2. Cotton prices are coming down

While sales may be headed higher this year, profits aren't expected to move in the same direction. Analysts expect earnings to slip from 2022's $1.50 per share to a consensus estimate of $1.34. The company itself says its bottom line should roll in somewhere between $1.30 and $1.40 per share, with Levi's fourth-quarter report specifically pointing to higher production costs.

This big cost, however, may be on the verge of coming down in a bigger way than Levi Strauss or the analyst community expects.

Yes, most companies have been struggling of late with rising expenses. Few have been hit as hard as the denim industry, though. Prices of cotton (used to manufacture denim) soared to a decade high of $1.55 per pound in April of last year, and the commodity was still plenty expensive before and after that peak. But these prices have cooled dramatically. Cotton's current price is around $0.81 per pound, and it's expected to linger for the foreseeable future.

^DJCCT Chart

^DJCCT data by YCharts.

This relief should provide some noticeable but somewhat unexpected benefit to Levi Strauss' bottom line as the apparel company locks in lower input prices.

3. Levi's stock price is low and its dividend is high

Finally, perhaps the most important reasons you might want to plug into this blue jeans blue chip in anticipation of a new bull market are the stock's current price and the dividend it's dishing out. Shares are presently valued modestly at around 13 times this year's predicted profits and less than 12 times next fiscal year's expected per-share earnings of $1.53. Meanwhile, the current dividend yield of 2.75% is above the S&P 500's current average yield.

That's a dividend, by the way, that has been paid like clockwork every quarter since reinstating it back in early 2021. It's also been raised each year since being reinstated.

This valuation alone, however, isn't the only compelling argument for owning Levi Strauss right now. It's also a value stock at a point when value stocks enjoy an edge on growth names.

At the risk of wading too deeply into philosophical waters, the chief reason growth stocks outperformed their value counterparts since coming out of the subprime mortgage meltdown in 2009 is the ultra-low interest rates we saw during that 13-year stretch. That's not the case anymore, though.

Yields on 10-year Treasuries are just under 4% now, reaching their highest levels since 2009 and inching higher. Other interest rates are following suit, suggesting this bull market will be one marked by higher rates that weren't much of a factor during the last one. More to the point, it's a backdrop making cash-driving, predictable value stocks like Levi Strauss better bets than many growth stocks when the cost of capital is suddenly relatively higher.