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Birkenstock Holding plc (BIRK) Intrinsic Value

DCF-based fair value calculation with Bear, Base, and Bull scenarios

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Birkenstock Holding plc (BIRK)

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Intrinsic Value (DCF)

Current$40.61
→
Intrinsic$47.38
+17%
$30.24$47.38$79.92
Market implies 20% growth for 5 years
BIRK shows 17% potential upside using 24% growth — reasonable if fundamentals hold.
At $41, the market prices in continued high-teens cash flow growth (20%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $30 → Bull $80. Current price implies expectations below the base case, but well above the bear case.
Discount ↓Growth →20%22%24%26%
8%$60$65$71$77
10%$40$43$47$52
12%$29$32$35$38
14%$22$24$26$29

Bull Case

  • Bull case ($80) offers 97% upside at 28% growth, 9% discount
  • 14% margin of safety vs. base case estimate
  • Market-implied growth (20%) ≤ historical CAGR (24%)

Bear Case

  • Bear case ($30) implies 26% downside at 19% growth, 12% discount
  • Using 24% growth — aggressive, watch for mean reversion
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5-Year Free Cash Flow Projection

Year 1$369.84M
Year 2$456.94M
Year 3$564.56M
Year 4$697.52M
Year 5$861.79M
Terminal$12.68B

📐 Model Inputs

Growth Rate23.6%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$299.35MTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
ℹ️

DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.

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Frequently Asked Questions

Is BIRK stock undervalued or overvalued?
🟡 FAIRLY VALUED

BIRK trades at $40.61, within 10% of our $40.63 intrinsic value estimate. At 10.0% WACC and 23.6% FCF growth, the market is pricing in assumptions roughly aligned with the 5-year historical CAGR. The valuation range spans $24.46 (bear) to $64.44 (bull).

What is BIRK's intrinsic value?

Using a 5-year DCF model: Base FCF of $299M, projected at 23.6% 5Y CAGR (best of revenue, EPS, or FCF growth), discounted at 10.0% WACC, with 3.0% terminal growth. Terminal value calculated via Gordon Growth Model: TV = FCF₅ × (1+g) / (WACC−g). After deducting $1.19B net debt and dividing by 0.19B shares: Bear $24.46 | Base $40.63 | Bull $64.44. Current price $40.61 implies -5% to base case.

How is BIRK's fair value calculated?

DCF Methodology:

① Project FCF years 1-5 using 23.6% growth derived from 5-year historical CAGR (best of revenue, EPS, or FCF growth, with 8% floor and 25% cap).

② Calculate terminal value at year 5 using perpetuity growth model with g=3.0%.

③ Discount all cash flows to PV using WACC=10.0%.

④ Sum PV of explicit period + PV of terminal value = Enterprise Value ($8.76B).

⑤ Subtract net debt, divide by shares outstanding.

Sensitivity analysis available above—adjust WACC ±2% or growth ±3% to stress-test the valuation. Implied EV/FCF multiple: 29.3x.