Williams Trading raised its rating on Birkenstock Holding plc (NYSE:BIRK) from Hold to Buy on Tuesday, while maintaining a $49.00 price target. The firm said the target implies roughly 30% upside from the stock's trading level, which was $37.11 at the time of the note. That price sits close to Birkenstock's 52-week low of $36.45 and well below its 52-week high of $59.50.
The upgrade was described by Williams Trading as valuation-driven. The research team noted that Birkenstock’s recent Capital Markets Day produced few surprises and that the current share price creates an attractive entry point when measured against the firm’s earnings projections.
Valuation metrics cited
- The $49 price target corresponds to implied EBITDA multiples of 11.7x and 10.2x for Williams Trading’s fiscal 2026 and 2027 estimates, respectively.
- InvestingPro data referenced by the research shows a P/E ratio of 16.92 for Birkenstock and a PEG ratio of 0.2, which the note characterized as indicating the shares are undervalued relative to expected growth.
- Williams Trading also reported that Birkenstock is trading at 9.2x and 8.0x the firm’s FY26 and FY27 estimates, supporting its view that valuation is compelling at current levels.
Complementing the valuation analysis, InvestingPro’s profitability metric highlighted in the note gives Birkenstock a Piotroski Score of 9, signaling strong financial health under that scorecard.
Operational observations and distribution concerns
Williams Trading reiterated operational nuances raised during the company’s recent investor event, noting a tension in the corporate identity between manufacturing and brand-led retail. The firm quoted CEO Oliver Reichert as characterizing Birkenstock as a "manufacturing company at heart," while the company also seeks to operate as a consumer-first, demand-led brand.
The research note flagged specific distribution frictions, calling out limited product availability on the online retailer Zalando and inconsistent retail pricing across outlets. Williams Trading suggested these factors may reduce consumer appreciation for the brand’s value proposition if left unaddressed.
Earnings and analyst activity
In related financial news, Birkenstock reported preliminary first-quarter revenue of c402 million, which closely matched the Bloomberg Consensus estimate of c401.8 million. The revenue update followed a series of analyst reactions:
- BTIG reiterated its Buy rating and kept a $65 price target.
- Morgan Stanley lowered its price target to $47 from $57, while maintaining an Equalweight rating and noting the upcoming Command Day as a material event for the company.
- Seaport Global Securities began coverage with a Neutral rating, acknowledging Birkenstock’s emphasis on sustainable growth and scarcity management.
- Bernstein reduced its price target to $50 from $55 and kept a Market Perform rating, citing concerns about the cyclical nature of the footwear sector.
These analyst updates illustrate differing views among sell-side firms on Birkenstock’s near-term trajectory and the balance between brand strategy and operational execution.
Overall, Williams Trading’s shift to Buy rests on relative valuation metrics and projected earnings multiples rather than new operational developments, while competing analyst opinions underscore both upside potential and execution-related risks in the footwear and retail spaces.