November 30, 2023
Shares of German sandal maker Birkenstock extended gains on Wednesday, hitting the initial public offering price for the first time, following a buoyant holiday shopping season.
Strong spending by American shoppers during the Thanksgiving holiday, as well as Black Friday and Cyber Monday, boosted retail sales at a record this year, potentially benefiting luxury brands like Birkenstock.
The company’s shares opened at $41 on October 11 and have traded below the initial public offering price of $46 and fell as low as $35.83 within days of going public. On Tuesday, the stock rose more than 9% and continued its rally on Wednesday, rising as much as 2.7% to $46.60.
Birkenstock’s lackluster market debuts, as well as other highly anticipated offerings from chip designer Arm Holdings, grocery delivery app Instacart and marketing automation firm Klaviyo, have dampened hopes for an IPO market resurgence in USA.
The average price target of the 17 analysts covering Birkenstock is $47.21 and the current recommendation is “buy,” according to LSEG data.
Birkenstock is heavily shorted, with 5.71 million shares worth about $259 million with short interest, according to data and analytics firm Ortex. Around 32.3 million shares were sold in the IPO.
The company is owned by US private equity firm L Catterton, which is backed by French billionaire Bernard Arnault and his Louis Vuitton Moet Hennessy luxury goods empire.
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