Critical Review: Xtep International (OTCMKTS:XTEPY) & Birkenstock (NYSE:BIRK)

Xtep International (OTCMKTS:XTEPY) and Birkenstock (NYSE:BIRK) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, analyst recommendations, earnings and risk.

Institutional and Insider Ownership

19.9% of Birkenstock shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Profitability

This table compares Xtep International and Birkenstock’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Xtep International	N/A	N/A	N/A
Birkenstock	16.26%	12.95%	7.15%

Valuation & Earnings

This table compares Xtep International and Birkenstock”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Xtep International	$1.97 billion	0.77	$190.79 million	N/A	N/A
Birkenstock	$2.32 billion	2.59	$385.46 million	$2.21	14.75

Birkenstock has higher revenue and earnings than Xtep International.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Xtep International and Birkenstock, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Xtep International	0	1	0	0	2.00
Birkenstock	1	3	13	0	2.71

Birkenstock has a consensus target price of $54.14, suggesting a potential upside of 66.10%. Given Birkenstock’s stronger consensus rating and higher probable upside, analysts plainly believe Birkenstock is more favorable than Xtep International.

Risk & Volatility

Xtep International has a beta of 0.2, meaning that its stock price is 80% less volatile than the S&P 500. Comparatively, Birkenstock has a beta of 1.15, meaning that its stock price is 15% more volatile than the S&P 500.

Summary

Birkenstock beats Xtep International on 11 of the 11 factors compared between the two stocks.

About Xtep International

Xtep International Holdings Limited engages in the design, development, manufacture, sale, and marketing and brand management of sports footwear, apparel, and accessories. The company sells its products primarily under the XTEP brand, as well as Palladium, K-Swiss, Saucony, and Merrell brand names. It is also involved in the trading of sportswear products. As of March 18, 2021, the company managed an extensive distribution network with exclusive distributors that operated approximately 6,000 stores covering 31 provinces, autonomous regions, and municipalities in the People's Republic of China and internationally. It also offers its products online. The company was founded in 1999 and is headquartered in Xiamen, the People's Republic of China. Xtep International Holdings Limited is a subsidiary of Group Success Investments Limited.

About Birkenstock

Birkenstock Holding plc manufactures and sells footwear products. It also offers sandals, shoes, closed-toe silhouettes, skincare products, and accessories. The company sells its products through e-commerce sites and a network of owned retail stores, as well as business-to-business channels. It operates in the United States, Brazil, Canada, Mexico, Europe, APMA, and internationally. Birkenstock Holding plc was founded in 1774 and is based in London, the United Kingdom. Birkenstock Holding plc is a subsidiary of BK LC Lux MidCo S.à r.l.