Head-To-Head Analysis: Tapestry (NYSE:TPR) & Birkenstock (NYSE:BIRK)

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

Insider and Institutional Ownership

19.9% of Birkenstock shares are owned by institutional investors. Comparatively, 90.8% of Tapestry shares are owned by institutional investors. 1.3% of Tapestry shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Birkenstock and Tapestry”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Birkenstock	$2.27 billion	2.66	$385.46 million	$2.13	15.90
Tapestry	$8.00 billion	3.05	$1.53 billion	$7.29	16.81

Tapestry has higher revenue and earnings than Birkenstock. Birkenstock is trading at a lower price-to-earnings ratio than Tapestry, indicating that it is currently the more affordable of the two stocks.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Birkenstock	14.82%	13.36%	7.21%
Tapestry	19.09%	254.95%	22.75%

Analyst Ratings

This is a breakdown of current recommendations for Birkenstock and Tapestry, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Birkenstock	0	5	13	0	2.72
Tapestry	0	4	15	2	2.90

Birkenstock currently has a consensus target price of $53.91, indicating a potential upside of 59.16%. Tapestry has a consensus target price of $175.12, indicating a potential upside of 42.90%. Given Birkenstock’s higher probable upside, analysts clearly believe Birkenstock is more favorable than Tapestry.

Risk and Volatility

Birkenstock has a beta of 1.28, indicating that its share price is 28% more volatile than the S&P 500. Comparatively, Tapestry has a beta of 1.42, indicating that its share price is 42% more volatile than the S&P 500.

Summary

Tapestry beats Birkenstock on 14 of the 15 factors compared between the two stocks.

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.

About Tapestry

Tapestry, Inc. provides luxury accessories and branded lifestyle products in the United States, Japan, Greater China, and internationally. The company operates in three segments: Coach, Kate Spade, and Stuart Weitzman. It offers women’s handbags; and women’s accessories, such as small leather goods which includes mini and micro handbags, money pieces, wristlets, pouches, and cosmetic cases, as well as novelty accessories including address books, time management and travel accessories, sketchbooks, and portfolios; and belts, key rings, and charms. The company also provides men products, which includes bag collections, such as business cases, computer bags, messenger-style bags, backpacks, and totes; small leather goods including wallets, card cases, travel organizers, and belts; and footwear, watches, fragrances, sunglasses, novelty accessories, and ready-to-wear items. In addition, it offers other products including women’s footwear and fragrances; eyewear and sunglasses; and jewelry, such as bracelets, necklaces, rings, and earrings, watches, and other women’s seasonal lifestyle apparel collections, including outerwear, ready-to-wear and cold weather accessories, such as gloves, scarves, and hats. Further, the company provides kids items, housewares, and home accessories, such as fashion bedding and tableware, stationery, and gifts. It offers its products through e-commerce sites and concession shop-in-shops, wholesale, and third-party distributors under the Coach, Kate Spade, and Stuart Weitzman brand names. The company was formerly known as Coach, Inc. and changed its name to Tapestry, Inc. in October 2017. Tapestry, Inc. was founded in 1941 and is headquartered in New York, New York.