Shares of Birkenstock (BIRK, Financial) fell by 16.97% on Thursday following the release of its fiscal third-quarter 2024 results.
For Q3, which ended on June 30, Birkenstock reported revenue of 565 million euros, marking a 19% increase. The company earned a net profit of 75 million euros. Despite these positive figures, analysts had higher expectations. Birkenstock maintained its full-year financial guidance, forecasting a 19% revenue growth, a 60% gross margin, and a 30% adjusted EBITDA margin.
Before the Q3 report, Birkenstock stock was trading at a high price-to-sales (P/S) valuation of 6.5. The stock's recent decline may be attributed to investors taking profits given the high valuation and results that met but did not exceed expectations.
Currently, Birkenstock (BIRK, Financial) stock is priced at $50.4. The stock has several warning signs, including a high price-to-earnings (P/E) ratio of 88.11, close to its one-year high. The Price-to-Book (P/B) ratio stands at 3.41. Despite the decline, the company has some strong financial metrics, such as an Altman Z-Score of 3.62, indicating financial strength, and a Beneish M-Score of -2.59, suggesting it is unlikely to be a manipulator.
In terms of market valuation, Birkenstock's enterprise value is at $12,882.73 million. The current market capitalization is $9,466.59 million. The company's gross margin is robust at 60.83%, and it boasts a return on invested capital (ROIC) of 3.8%. However, it is worth noting that the company's return on invested capital is lower than its weighted average cost of capital (WACC) of 9.26%, hinting at potential inefficiencies.
When evaluating Birkenstock's valuation using GuruFocus's GF Value, more insights can be found by visiting their GF Value page.
Investors should carefully consider these metrics and the company's recent performance before making any investment decisions.
