Reviewing Birkenstock (NYSE:BIRK) and NIKE (NYSE:NKE)

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

Analyst Recommendations

This is a breakdown of current ratings and price targets for Birkenstock and NIKE, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Birkenstock	0	0	13	1	3.07
NIKE	0	12	17	3	2.72

Birkenstock presently has a consensus price target of $68.5833, indicating a potential upside of 42.29%. NIKE has a consensus price target of $78.2222, indicating a potential upside of 5.46%. Given Birkenstock’s stronger consensus rating and higher possible upside, research analysts plainly believe Birkenstock is more favorable than NIKE.

Earnings & Valuation

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Birkenstock	$1.96 billion	4.62	$207.85 million	$1.42	33.94
NIKE	$46.31 billion	2.37	$3.22 billion	$2.16	34.34

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Birkenstock	12.86%	10.22%	5.53%
NIKE	6.95%	23.33%	8.57%

Volatility & Risk

Birkenstock has a beta of 1.31, meaning that its stock price is 31% more volatile than the S&P 500. Comparatively, NIKE has a beta of 1.27, meaning that its stock price is 27% more volatile than the S&P 500.

Institutional & Insider Ownership

19.9% of Birkenstock shares are owned by institutional investors. Comparatively, 64.3% of NIKE shares are owned by institutional investors. 0.8% of NIKE shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

NIKE beats Birkenstock on 10 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 NIKE

NIKE, Inc., together with its subsidiaries, designs, develops, markets, and sells athletic footwear, apparel, equipment, accessories, and services worldwide. The company provides athletic and casual footwear, apparel, and accessories under the Jumpman trademark; and casual sneakers, apparel, and accessories under the Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell trademarks. It also sells a line of performance equipment and accessories comprising bags, sport balls, socks, eyewear, timepieces, digital devices, bats, gloves, protective equipment, and other equipment for sports activities under the NIKE brand; and various plastic products to other manufacturers. In addition, the company markets apparel with licensed college and professional team, and league logos, as well as sells sports apparel; and licenses unaffiliated parties to manufacture and sell apparel, digital devices, and applications and other equipment for sports activities under NIKE-owned trademarks. It sells its products to footwear stores; sporting goods stores; athletic specialty stores; department stores; skate, tennis, and golf shops; and other retail accounts through NIKE-owned retail stores, digital platforms, independent distributors, licensees, and sales representatives. NIKE, Inc. was founded in 1964 and is headquartered in Beaverton, Oregon.