Birkenstock Holding (BIRK) shares are trading higher Wednesday after the footwear maker beat top- and bottom-line expectations for its fiscal 2024 fourth quarter.
In the three months ending September 30, Birkenstock's revenue increased 21.7% year over year to 455.8 million euros, due in part to 26% growth in its business-to-business (B2B) segment to 240.2 million euros and a 17.7% jump in its direct-to-consumer (DTC) segment to 214.9 million euros. Its net profit more than doubled from the year-ago period to 29 euro cents per share.
"I'm proud to be reporting very strong 2024 results, with both revenue and adjusted EBITDA [earnings before interest, taxes, depreciation and amortization] coming in ahead of our expectations," said Birkenstock CEO Oliver Reichert in a statement. "As we continue to gain the attention of consumers and wholesale partners, we are seeing strong, balanced growth in both our DTC and B2B channels."
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results beat analysts' expectations. Wall Street was anticipating revenue of 455.8 million euros and earnings of 26 euro cents per share, according to CNBC.
"As we look into 2025 and beyond, we are confident in our ability to deliver on our medium to long-term objectives for mid-to-high teens revenue growth, gross profit margin of around 60% and adjusted EBITDA margin of over 30%," Reichert said.
Is Birkenstock a buy, sell or hold?
Birkenstock shares are up more than 23% for the year to date, slightly lagging the broader S&P 500's nearly 27% gain. But Wall Street remains bullish on the consumer discretionary stock.
According to S&P Global Market Intelligence, the average analyst target price for BIRK stock is $65.35, representing implied upside of almost 17% to the December 17 close. Additionally, the consensus recommendation is a Buy. Analysts may very well raise their price targets in the days and weeks ahead following the earnings beat.
Financial services firm UBS Global Research is one of the more bullish outfits on the retail stock with a Buy rating and $85 price target.
"We think BIRK's sales and earnings per share outlook warrants a higher valuation," wrote UBS analyst Jay Sole in a December 10 note. "We believe Birkenstock has the potential to expand its dominance as a premium casual footwear brand with a presence globally."
Related Content
-
Ask the Editor: Home Sale Tax BreakAsk the Editor In this week's Ask the Editor Q&A, Joy Taylor answers questions on the gain exclusion tax break when you sell your home.
-
How to Skip Fees at the BankYou can steer clear of fees, especially if you choose your account wisely. Here are some tips to keep them at bay.
-
Here's What Being in the 2% Club Means for Your RetirementOnly 2% of the population has both a pension and more than $1 million saved. This is a great place to be, but also requires advanced tax planning.
-
Insurance Buyer Beware: States Are Lowering the Bar for Agents and BrokersA new California law removes 20 hours of required education before an aspiring agent can take tests to get licensed. They can then get licensed in other states.
-
Dow Erases 717-Point Gain to End Lower: Stock Market TodayThe main indexes started the day with solid gains, but worries of an AI bubble weighed on stocks into the close.
-
The Delayed September Jobs Report Is Out. Here's What It Means for the FedThe September jobs report came in much higher than expected, lowering expectations for a December rate cut.
-
Still Working While Receiving Social Security? A Financial Adviser's Guide to the Earnings TestIf you haven't reached your full retirement age yet, your Social Security check could take a hit, depending on how much you earn.
-
I'm an Attorney and a CPA: Charitable Giving Just Got a Little Easier, But Also a Little HarderThe OBBB shakes up charitable deductions with a little help for non-itemizers and a new challenge for itemizers this holiday season.
-
S&P 500 Snaps Losing Streak Ahead of Nvidia Earnings: Stock Market TodayThe Dow Jones Industrial Average also closed higher for the first time in five days, while the Nasdaq Composite notched a win too.
-
This HECM-QLAC Power Move Can Unlock Guaranteed Retirement IncomeCombining a qualified longevity annuity contract (QLAC) with a home equity conversion mortgage (HECM) can significantly boost your retirement income and more.
