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Birkenstock Holding plc (BIRK)
NYSE:BIRK
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Birkenstock Holding plc
(NYSE:BIRK)
75Outperform
Positive Factors
Brand Loyalty
The company is underpinned by a loyal brand following.
Geographic Expansion
Birkenstock is focusing on expanding its presence in the APAC region, which has shown significant growth potential.
Product Diversification
Birkenstock is broadening its product range to include closed-toe shoes, orthopedics, and professional categories, which helps expand its market.
Negative Factors
Gross Margin Pressure
GMs were down 70bp due to a higher wholesale mix, as expected, and this pressure is expected to continue in 2Q.
Macro Issues
Management acknowledges there are real macro issues at play.
Wholesale Channel Pressure
The company stressed the health of its wholesale channel with strong gains in full-price sell-through.
Birkenstock Holding plc (BIRK) vs. S&P 500 (SPY)
Market Cap
$9.43B
Dividend YieldN/A
Average Volume (3M)1.95M
Price to Earnings (P/E)39.8
Beta (1Y)1.02
Revenue Growth20.40%
EPS Growth134.09%
CountryUS
Employees6,200
SectorConsumer Cyclical
Sector Strength56
IndustryApparel - Footwear & Accessories
Share Statistics
EPS (TTM)1.26
Shares Outstanding187,829,210
10 Day Avg. Volume1,949,769
30 Day Avg. Volume1,945,768
Financial Highlights & Ratios
PEG Ratio0.30
Price to Book (P/B)N/A
Price to Sales (P/S)17.09
Price to Cash Flow (P/CF)11.00
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$65.00Price Target Upside29.43% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering13
Birkenstock Holding plc Business Overview & Revenue Model
Company DescriptionBirkenstock Holding plc manufactures and sells footwear products. It also offers sandals, shoes, closed-toe silhouettes, skincare products, and accessories. The company sells its products through e-commerce sites and a network of owned retail stores, as well as business-to-business channels. It operates in the United States, Brazil, Canada, Mexico, Europe, APMA, and internationally. Birkenstock Holding plc was founded in 1774 and is based in London, the United Kingdom. Birkenstock Holding plc is a subsidiary of BK LC Lux MidCo S.à r.l.
How the Company Makes MoneyBirkenstock Holding plc generates revenue primarily through the sale of its footwear products, which include sandals, shoes, and insoles. The company's key revenue streams are its retail operations, both online and through brick-and-mortar stores, as well as wholesale distribution to third-party retailers globally. Birkenstock's strong brand reputation and loyal customer base drive consistent demand for its products. Additionally, strategic partnerships and collaborations with fashion designers and other brands enhance its market presence and expand its consumer reach. The company's focus on sustainability and quality also allows it to command premium pricing, contributing to its overall earnings.
Birkenstock Holding plc Financial Statement Overview
Summary
Birkenstock Holding plc demonstrates strong financial health with robust revenue and profitability growth, solid balance sheet metrics, and effective cash flow management. While there is room for improvement in cash generation relative to net income, overall financial stability and growth prospects remain positive.Income Statement
Birkenstock Holding plc has demonstrated strong revenue growth, with the latest TTM revenue reaching approximately $1.87 billion, up from $1.49 billion in the previous year, indicating robust growth. The gross profit margin is healthy at around 57.6%, and the net profit margin has improved to 11.7%, highlighting improved profitability. The EBIT and EBITDA margins are strong, reflecting operational efficiency. These positive trends showcase strong financial performance in the income statement.85
Very Positive
Balance Sheet
The company maintains a solid balance sheet with an equity ratio of 54.9%, indicating a strong equity position relative to total assets. The debt-to-equity ratio has improved to 0.51, showcasing effective leverage management. Return on equity has increased to 8.0%, reflecting enhanced shareholder returns. Overall, the balance sheet indicates a stable financial position, with a cautious approach to leverage.80
Positive
Cash Flow
Birkenstock's cash flow statement reveals a positive trajectory in free cash flow, growing to $373 million in the latest TTM. The operating cash flow to net income ratio is robust, ensuring strong cash conversion. However, the free cash flow to net income ratio is slightly lower, suggesting room for improvement in cash generation relative to net income. Overall, the company exhibits solid cash flow management.78
Positive
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.87B | 1.80B | 1.49B | 1.24B | 962.13M | 728.55M | Gross Profit |
| 1.08B | 1.06B | 925.79M | 749.80M | 545.65M | 260.28M | EBIT |
| 455.86M | 421.08M | 260.69M | 363.03M | 230.25M | -42.71M | EBITDA |
| 535.07M | 503.67M | 360.35M | 423.14M | 230.25M | 3.35M | Net Income Common Stockholders |
| 218.88M | 191.60M | 75.02M | 187.11M | 116.44M | -106.19M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 298.59M | 376.46M | 354.06M | 307.08M | 235.34M | 96.18M | Total Assets |
| 5.01B | 4.88B | 4.83B | 4.79B | 4.27B | 803.56M | Total Debt |
| 1.39B | 1.35B | 1.98B | 2.04B | 1.89B | 220.43M | Net Debt |
| 1.10B | 994.23M | 1.64B | 1.74B | 1.65B | 124.26M | Total Liabilities |
| 2.26B | 2.26B | 2.43B | 2.43B | 2.20B | 395.39M | Stockholders Equity |
| 2.75B | 2.63B | 2.40B | 2.36B | 2.06B | 398.16M |
| Cash Flow | Free Cash Flow | ||||
| 373.00M | 354.80M | 255.79M | 161.54M | 159.65M | 171.26M | Operating Cash Flow |
| 447.61M | 428.70M | 358.73M | 234.14M | 181.41M | 193.60M | Investing Cash Flow |
| -66.48M | -58.80M | -100.73M | -71.65M | -18.20M | -3.50M | Financing Cash Flow |
| -254.72M | -355.05M | -199.28M | -105.32M | -84.96M | -130.25M |
Birkenstock Holding plc Technical Analysis
Positive
50.22
Price Trends
47.87
Positive
52.32
Negative
52.02
Negative
Market Momentum
0.37
Negative
59.85
Neutral
77.99
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BIRK, the sentiment is Positive. The current price of 50.22 is above the 20-day moving average (MA) of 46.73, above the 50-day MA of 47.87, and below the 200-day MA of 52.02, indicating a neutral trend. The MACD of 0.37 indicates Negative momentum. The RSI at 59.85 is Neutral, neither overbought nor oversold. The STOCH value of 77.99 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BIRK.
Birkenstock Holding plc Risk Analysis
Birkenstock Holding plc disclosed 81 risk factors in its most recent earnings report. Birkenstock Holding plc reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Birkenstock Holding plc Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $16.79B | 17.96 | 39.80% | ― | 19.40% | 32.70% | |
81 Outperform | $5.53B | 6.18 | 57.76% | ― | 3.53% | 24.55% | |
75 Outperform | $9.43B | 39.77 | 8.52% | ― | 20.40% | 134.09% | |
73 Outperform | $7.44B | 11.92 | 15.42% | ― | 12.11% | 19.16% | |
70 Outperform | $1.54B | 8.99 | 20.20% | 4.10% | 15.03% | 1.51% | |
61 Neutral | $1.04B | 22.25 | 15.57% | 3.24% | -21.75% | ― | |
60 Neutral | $6.78B | 11.63 | 3.24% | 4.20% | 2.36% | -21.91% |
* Consumer Cyclical Sector Average
Performance Comparison
BIRK
Birkenstock Holding plc
50.22
4.77
10.50%
CROX
Crocs
97.68
-27.72
-22.11%
DECK
Deckers Outdoor
110.65
-28.26
-20.34%
SKX
Skechers USA
47.79
-17.62
-26.94%
SHOO
Steven Madden
21.16
-18.45
-46.58%
WWW
Wolverine World Wide
12.72
2.09
19.66%
Birkenstock Holding plc Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: -1.02% | Next Earnings Date: May 15, 2025
Earnings Call Sentiment Positive
Birkenstock's first quarter of fiscal 2025 showed strong performance across various metrics, including record revenue growth, significant expansion in the APAC region, and increased demand for closed-toe footwear. Despite a slight decrease in gross margin and seasonal working capital challenges, the overall positive results and strategic growth initiatives suggest a promising outlook.Highlights
Record Revenue Growth
Birkenstock reported a 19% revenue growth for the first quarter of fiscal 2025, exceeding the high end of their 15% to 17% target for the full year. This growth was driven by a combination of strong holiday demand, double-digit volume growth, and mid-single-digit growth in average selling price.
B2B and DTC Business Performance
The B2B business grew by 30% in the first quarter, driven by strong sell-through and reorders from wholesale partners. The DTC business also grew by 10%, with a notable increase in website traffic during the holiday season.
APAC Region Growth
The APAC region was the fastest-growing segment, with a 47% increase, 2.5 times the pace of the overall business. This growth was supported by store openings and increased brand awareness.
Expansion in Closed-Toe Footwear
Revenue from closed-toe silhouettes grew at twice the rate of the overall group, accounting for over half of the revenue in the quarter and increasing share of business by 600 basis points.
Strong Membership Growth
Birkenstock's membership base grew by nearly 30% year-over-year, reaching 8.8 million loyal members.
Lowlights
Gross Margin Slightly Down
Gross margin for the quarter was 60.3%, slightly down by 70 basis points year-over-year, primarily due to a higher B2B mix.
Seasonal Working Capital Challenges
Cash and cash equivalents decreased from €356 million at the end of fiscal 2024 to €299 million this quarter, due to normal seasonality of working capital usage.
Company Guidance
During Birkenstock's first quarter 2025 earnings call, the company reported a robust performance with a 19% revenue growth, surpassing the high end of their 15% to 17% annual target. The growth was fueled by strong holiday demand, double-digit volume growth, and mid-single-digit growth in average selling prices. The B2B segment saw a significant 30% increase, while the DTC business grew by 10%. The company opened four new retail stores, bringing the total to 71 globally, and their APAC region led growth with a 47% increase. Birkenstock's EBITDA margin improved by 25%, reaching 28.2%, with an adjusted net profit of €33 million, up 99% year-over-year. The company's membership base grew to 8.8 million, marking a 30% increase from the previous year. Looking ahead, they anticipate balanced growth between DTC and B2B channels, maintaining their 15% to 17% revenue growth guidance for the year.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.