Birkenstock Holding plc (NYSE:BIRK) gained in early trading on Monday after both UBS and Citi weighed in positively on the footwear stock.

UBS upgraded Birkenstock (BIRK) to a Buy rating from Neutral and hiked its price target to $63. The firm said its bullish view on BIRK is based on confidence that it can achieve stronger sales and margins over the long term. Notably, Birkenstock (BIRK) is believed to be successfully executing its direct-to-consumer expansion strategy better than it expected. UBS forecasts average selling prices for Birkenstock (BIRK) will be stronger than anticipated. Due to the recent momentum, UBS raised its five-year EPS CAGR forecast to 25% from 21% and now has a 2026 EPS estimate on BIRK that is 10% above the consensus estimate.

Meanwhile, Citi resumed coverage on Birkenstock (BIRK) with a Buy rating and price target of $65. Analyst Paul Lejeuz pointed out that BIRK is one of the fastest-growing companies in retail and has industry-leading EBIT margins. "At only €1.5BN ($1.6BN) in F23 sales, BIRK has a significant runway for further growth that supports mid- to high-teens sales growth and a 20%+ EPS CAGR over the next three years," he highlighted.

Shares of Birkenstock (BIRK) were up 1.96% in early trading on Monday. Birkenstock (BIRK) fell last week along with other footwear names after Nike's (NKE) soft guidance rattled the sector. Nike (NKE) warned that sales will decline 10% in its current quarter due to uneven consumer trends and will be down at a mid single-digit clip for the full year. "Nike’s 4Q report indicated its fundamental trends are much worse than we realized. Our key conclusion is there will be no quick rebound for Nike’s earnings," highlighted analyst Jay Sole about the report.