Birkenstock Holding plc (BIRK): A Bull Case Theory

We came across a bullish thesis on Birkenstock Holding plc on r/Valueinvesting’s Substack by u/raytoei. In this article, we will summarize the bulls’ thesis on BIRK. Birkenstock Holding plc’s share was trading at $42.69 as of January 13th. BIRK’s trailing and forward P/E were 19.57 and 17.92, respectively according to Yahoo Finance.

Birkenstock has recently faced a stock pullback following weaker than expected forward guidance, despite the brand’s demand remaining intact. The company, listed as BIRK in New York and 7PV in Frankfurt, has an unusual governance dynamic, with management openly dismissive of analysts and largely focused on its controlling shareholder, L Catterton, the private equity arm of LVMH, which owns 62 % of the business.

Management had previously emphasized a long-term goal of 20 % revenue growth driven by managed scarcity, but this target was first reduced to 15% to 18 % constant currency growth and later to 13% to 15% for fiscal year 2026, triggering investor disappointment. For fiscal year 2025, Birkenstock generated approximately €2.1 billion in revenue with a market capitalization near €7 billion and earnings per share of €1.87.

Profitability metrics remain solid, with ROE near 13 %, ROIC close to 10 %, moderate leverage at roughly 1.4 times net debt to EBITDA, and free cash flow consistently exceeding net income. Historical growth has been strong, with revenue CAGR exceeding 15 % over the past three years and EPS growth above 20%, although the public track record remains relatively short.

Looking forward, consensus growth expectations vary widely, ranging from high single digits to mid-teens, broadly aligning with management’s tempered outlook. Fiscal 2026 guidance implies adjusted EPS of $2.22 to $2.40 or $2.40 to $2.63. on an underlying basis excluding currency headwinds.

A conservative valuation assuming 9 % EPS growth and a 9% discount rate yields a fair value near $48.62 per share, modestly above current levels and broadly consistent with Morningstar’s estimate. While the stock does not appear expensive, the guidance reset and governance concerns justify caution, suggesting greater upside only at a deeper discount.

Previously, we covered a bullish thesis on Birkenstock Holding plc by Bulls On Parade in February 2025, which highlighted strong brand power, Asia expansion, margin recovery, and high teens growth. The company’s stock price has depreciated approximately 17.58% since our coverage. This is because guidance expectations were reset lower. u/raytoei emphasizes valuation discipline, governance risk, and downside protection.

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Disclosure: None.