We assign a fundamental rating of 6 out of 10 to BIRK. BIRK was compared to 45 industry peers in the Textiles, Apparel & Luxury Goods industry. While BIRK has a great profitability rating, there are some minor concerns on its financial health. BIRK is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! This makes BIRK very considerable for growth investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

BIRK had positive earnings in the past year.
BIRK had a positive operating cash flow in the past year.
BIRK had positive earnings in each of the past 5 years.
BIRK had a positive operating cash flow in each of the past 5 years.

1.2 Ratios

With an excellent Return On Assets value of 7.05%, BIRK belongs to the best of the industry, outperforming 82.22% of the companies in the same industry.
BIRK's Return On Equity of 12.79% is fine compared to the rest of the industry. BIRK outperforms 71.11% of its industry peers.
BIRK's Return On Invested Capital of 8.59% is fine compared to the rest of the industry. BIRK outperforms 66.67% of its industry peers.

		Industry Rank	Sector Rank
ROA	7.05%
ROE	12.79%
ROIC	8.59%

ROA(3y)N/A

ROA(5y)N/A

ROE(3y)N/A

ROE(5y)N/A

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

BIRK has a Profit Margin of 16.61%. This is amongst the best in the industry. BIRK outperforms 97.78% of its industry peers.
In the last couple of years the Profit Margin of BIRK has grown nicely.
BIRK has a better Operating Margin (26.38%) than 100.00% of its industry peers.
In the last couple of years the Operating Margin of BIRK has grown nicely.
The Gross Margin of BIRK (59.18%) is better than 77.78% of its industry peers.
In the last couple of years the Gross Margin of BIRK has grown nicely.

		Industry Rank	Sector Rank
OM	26.38%
PM (TTM)	16.61%
GM	59.18%

OM growth 3Y1.25%

OM growth 5Y5.76%

PM growth 3Y3.33%

PM growth 5Y3.6%

GM growth 3Y-0.64%

GM growth 5Y1.51%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so BIRK is destroying value.
BIRK has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.

2.2 Solvency

An Altman-Z score of 2.80 indicates that BIRK is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.80, BIRK is in the better half of the industry, outperforming 62.22% of the companies in the same industry.
The Debt to FCF ratio of BIRK is 4.37, which is a neutral value as it means it would take BIRK, 4.37 years of fcf income to pay off all of its debts.
BIRK's Debt to FCF ratio of 4.37 is fine compared to the rest of the industry. BIRK outperforms 62.22% of its industry peers.
BIRK has a Debt/Equity ratio of 0.46. This is a healthy value indicating a solid balance between debt and equity.
BIRK has a Debt to Equity ratio of 0.46. This is comparable to the rest of the industry: BIRK outperforms 48.89% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.46
Debt/FCF	4.37
Altman-Z	2.8

ROIC/WACC0.95

WACC9.06%

2.3 Liquidity

A Current Ratio of 2.81 indicates that BIRK has no problem at all paying its short term obligations.
BIRK has a Current ratio of 2.81. This is in the better half of the industry: BIRK outperforms 80.00% of its industry peers.
A Quick Ratio of 1.26 indicates that BIRK should not have too much problems paying its short term obligations.
BIRK has a Quick ratio of 1.26. This is in the better half of the industry: BIRK outperforms 66.67% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	2.81
Quick Ratio	1.26

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 45.31% over the past year.
The Earnings Per Share has been growing by 28.17% on average over the past years. This is a very strong growth
The Revenue has grown by 16.22% in the past year. This is quite good.
Measured over the past years, BIRK shows a very strong growth in Revenue. The Revenue has been growing by 23.57% on average per year.

EPS 1Y (TTM)45.31%

EPS 3Y23.15%

EPS 5Y28.17%

EPS Q2Q%75.86%

Revenue 1Y (TTM)16.22%

Revenue growth 3Y19.06%

Revenue growth 5Y23.57%

Sales Q2Q%15.48%

3.2 Future

Based on estimates for the next years, BIRK will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.15% on average per year.
Based on estimates for the next years, BIRK will show a quite strong growth in Revenue. The Revenue will grow by 11.05% on average per year.

EPS Next Y11.18%

EPS Next 2Y15.51%

EPS Next 3Y15.38%

EPS Next 5Y10.15%

Revenue Next Year12.19%

Revenue Next 2Y13.24%

Revenue Next 3Y13.08%

Revenue Next 5Y11.05%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.

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4. Valuation

4.1 Price/Earnings Ratio

BIRK is valuated correctly with a Price/Earnings ratio of 16.93.
BIRK's Price/Earnings ratio is a bit cheaper when compared to the industry. BIRK is cheaper than 66.67% of the companies in the same industry.
BIRK's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.30.
BIRK is valuated correctly with a Price/Forward Earnings ratio of 15.26.
BIRK's Price/Forward Earnings is on the same level as the industry average.
BIRK is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.57, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	16.93
Fwd PE	15.26

4.2 Price Multiples

BIRK's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, BIRK is valued a bit cheaper than 66.67% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	19.38
EV/EBITDA	10.16

4.3 Compensation for Growth

BIRK's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
BIRK has an outstanding profitability rating, which may justify a higher PE ratio.
BIRK's earnings are expected to grow with 15.38% in the coming years. This may justify a more expensive valuation.