F'Q2 Misses on Middle East Headwinds, Although Underlying Business Remains Strong. Reiterate Buy, Lower PT to $60.

研报英文原文证据摘录

F'Q2 Misses on Middle East Headwinds, Although Underlying Business Remains Strong. Reiterate Buy, Lower PT to $60.

Investment Thesis

BIRK stands out as a unique retail growth story that marries both a long brand legacy with future expansion potential, capable of

delivering strong double-digit % top-line growth (long-term algo calls for 13%-15%) with stable to improving margins. This level of

robust, yet relatively predictable, growth should command a premium multiple, in our view. To this end, we note several factors that

remain underappreciated, including (1) BIRK's function-led approach and strong consumer loyalty, which drive both high repeatCONSUMER purchases (corroborated by our own survey work) and a more stable financial profile, (2) the quality of BIRK's distribution network,

which allows wholesale to serve as a key customer acquisition vehicle and a highly profitable extension of its own DTC business,

and (3) the ability for recent investments (which double production capacity) to allow BIRK to realize its growth opportunities and

reach the global scale of peers.RETAIL

AND Upcoming■ F'Q3'26 EarningsCatalysts(est. August) Price$75 Performance

■ Global growth, particularly in APAC, as capacity investments are leveraged $70

■ Expansion of DTC, including owned retail $65

■ Category expansion, including growth in closed-toe, and expansion in professional, $60

orthopedic, active and outdoor, and kids $55 $50

$45LIFESTYLE

$40 Base Case Assumptions: $60 Price Target

$35

■ Revenues increase 14.8% in CC YoY in F'26 (at high end of guidance +13%-15% in $30

CC), with an Adjusted EBITDA margin of 30.3% (within guidance of 30.0%-30.5%). Jun-25 Jul-25 Aug-25 Sep-25 Oct-25 Nov-25 Dec-25 Jan-26 Feb-26 Mar-26 Apr-26 May-26 Revenues increase 13.8% in CC YoY in F'27