UBS has reaffirmed its Buy recommendation on Birkenstock Holding plc and kept a $77.00 price target ahead of the company’s first-quarter earnings, which are due on February 12. The firm’s stance comes as the shares trade well below that target; InvestingPro data shows the stock at $38.54, and the InvestingPro Fair Value model signals the shares may be undervalued at current levels.
According to UBS, expectations heading into the quarter are for results that are largely in line with prior signals from management. The bank anticipates Birkenstock will report in-line revenue growth for the first quarter as well as adjusted EBITDA margin and earnings per share that match the company’s pre-announced range. Management had already shared its preliminary Q1 financials and reaffirmed the fiscal 2026 outlook during the company’s Investor Day on January 28.
UBS noted several balance-sheet and operational metrics it views positively. InvestingPro data highlights a gross profit margin of 59.18% and a Piotroski Score of 9, metrics the bank considers indicative of strong underlying financials. Given that foreign exchange rates and tariff assumptions are believed to be broadly consistent with the assumptions that underpinned management’s FY26 outlook, UBS does not expect Birkenstock to revise its full-year guidance in the first quarter.
The analyst house also pointed to company disclosure practices as a factor in its assessment. Birkenstock typically does not provide forward-looking quarterly guidance, and UBS expects that pattern to continue. For those reasons, UBS described the upcoming Q1 release as mostly derisked from the perspective of forward guidance surprises.
Market positioning around the earnings event shows the options market is pricing a larger potential swing than historical norms. Implied moves for the stock over earnings are roughly plus or minus 7.8%, compared with a 6.3% historical average move. UBS, however, expects the actual share-price reaction to be less volatile than what options traders are currently pricing.
Outside of UBS’s view, several other market participants and credit agencies have recently updated their assessments of Birkenstock. S&P Global Ratings upgraded the company’s rating to BB+ from BB, citing strong operating performance and disciplined capital allocation; S&P expects Birkenstock to sustain an adjusted debt ratio around 2x by the end of fiscal 2026, supported by the brand’s equity.
On the sell-side and among other firms, Williams Trading moved its rating to Buy from Hold and set a $49.00 price target, attributing the change to valuation considerations. BTIG reiterated a Buy rating with a $65.00 target, calling attention to Birkenstock’s business model and potential for double-digit growth. Morgan Stanley trimmed its price target to $47.00 while keeping an Equalweight rating and flagged an upcoming Command Day as an important event. Seaport Global Securities began coverage with a Neutral rating, recognizing the company’s sustainable growth strategy and management’s emphasis on managing scarcity.
Key takeaways:
- UBS reiterates Buy and a $77.00 target, viewing Q1 as largely derisked given company pre-announcements and the reaffirmed FY26 outlook.
- InvestingPro data shows the stock trading at $38.54 with a 59.18% gross margin and a Piotroski Score of 9, suggesting solid financial health.
- Analyst and rating actions vary across the market, including an S&P upgrade to BB+ and a range of sell-side price targets from $47.00 to $65.00 and $49.00 from Williams Trading.
Risks and uncertainties:
- Options-implied volatility implies a larger share-price swing around earnings (±7.8%) than the historical average (6.3%), which could affect short-term market moves in the retail and consumer discretionary sectors.
- This quarter could still produce surprises if currency or tariff assumptions materially change, even though UBS currently sees those factors as largely unchanged relative to the FY26 outlook; such shifts would impact company-level guidance and potentially the broader apparel and footwear supply chain.