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Investing.com - Goldman Sachs has upgraded Birkenstock Holding plc (NYSE:BIRK) from Neutral to Buy and maintained its price target of $60.00, citing attractive growth opportunities despite challenging market conditions. The company, currently trading at $51.06 with a market capitalization of $9.39 billion, has demonstrated strong revenue growth of 19.89% over the last twelve months.
The investment bank highlighted Birkenstock's strong product proposition with pricing power as a key factor in its upgraded outlook for the footwear manufacturer.
Goldman Sachs noted that Birkenstock has opportunities to gain market share in a highly fragmented industry, supported by its iconic footbed design and margin resilience due to its vertically integrated manufacturing process in Europe.
The firm pointed to Birkenstock's recent stock performance, which has declined 17% over the last three months relative to footwear and lifestyle peers, creating what Goldman Sachs describes as an attractive entry point for investors.
Goldman Sachs projects Birkenstock can deliver a 15% compound annual growth rate in operating profit from 2025 to 2028, with the stock currently trading at 25 times estimated calendar year 2025 adjusted price-to-earnings and 20 times estimated 2026 earnings.
In other recent news, Birkenstock Holding plc has reported significant developments that have caught the attention of various investment firms. The company experienced a notable 18% constant currency revenue growth, with a €10 million increase, surpassing projections by Stifel analysts. This growth was driven by expanding global awareness and adoption, particularly among younger consumers. Additionally, Birkenstock's gross margin exceeded expectations by 130 basis points, leading Stifel to raise its price target to $70 and maintain a Buy rating.
Williams Trading also expressed optimism, lifting its price target to $73 and reiterating a Buy rating, citing strong brand management and financial performance. Meanwhile, Bernstein maintained a Market Perform rating with a $57 target, highlighting Birkenstock's impressive direct-to-consumer growth, which rebounded to 17% in the second quarter of FY25. Piper Sandler and William Blair maintained their positive ratings, despite challenges like tariff pressures and currency headwinds impacting revenue estimates. These firms acknowledged the company's resilience and brand strength, which have contributed to its sustained performance in the face of economic uncertainties.
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