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1. Company Snapshot

1.a. Company Description

Birks Group Inc.designs, develops, manufactures, and retails fine jewelry, timepieces, sterling and plated silverware, and gifts in the United States and Canada.The company operates through two segments, Retail and Other.


It offers various merchandise, including designer jewelry, diamonds, gemstone and precious metal jewelry, rings, wedding bands, earrings, bracelets, necklaces, precious gemstones, gold jewelry, and pearls.As of June 23, 2022, the company operated 24 stores under the Maison Birks brand in various metropolitan markets in Canada; one retail location under the Brinkhaus brand in Calgary; and 2 retail locations under the Graff and Patek Philippe brands in Vancouver.It also engages in the retail and wholesale of fine jewelry collections through Mappin & Webb and Goldsmiths stores, as well as through e-commerce platforms; and gold exchange business.


The company was formerly known as Birks & Mayors Inc.and changed its name to Birks Group Inc.in September 2013.


Birks Group Inc.was founded in 1879 and is headquartered in Montreal, Canada.

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1.b. Last Insights on BGI

Birks Group Inc.'s recent performance was positively driven by strategic initiatives, including the acquisition of the luxury watch and jewellery business of European Boutique, expanding its presence in the Canadian market. The company also announced a leadership transition, with Jean-Christophe Bédos stepping down as President and CEO, allowing for a repositioning for stability and long-term growth. Furthermore, the recommendation to appoint new auditors, Grant Thornton, may enhance corporate governance. These developments precede the company's fiscal 2025 results, which reported net sales of $177.8 million.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Birks Group Inc. Recommends Appointment of New Auditors

Sep -09

Source: businesswire.com

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Birks Group Inc. Announces New Leadership

Aug -26

Source: businesswire.com

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Birks Group Inc. Reports Fiscal 2025 Results

Jul -25

Source: businesswire.com

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Birks Group Completes the Acquisition of the Watch and Jewellery Business of European Boutique and Related Debt Financing Amendments

Jul -09

Source: businesswire.com

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Birks Group Discloses Acceptance of Compliance Plan by NYSE American

May -16

Source: businesswire.com

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Birks Group Discloses Receipt of Notice From NYSE American

Feb -28

Source: businesswire.com

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Birks Group Reports FY2025 Holiday Period Sales Results

Jan -29

Source: businesswire.com

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Birks Group Inc. Reports Mid-year Fiscal 2025 Results

Nov -27

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.38%)

6. Segments

Retail

Expected Growth: 4.5%

Growing demand for luxury goods, increasing brand awareness, and strategic store expansions drive growth in Birks Group's retail segment, with a focus on high-end jewelry and timepieces appealing to affluent Canadian consumers.

Other

Expected Growth: 2.5%

The 'Other' segment's growth is driven by increasing demand for insurance services and strategic investments, which are expected to contribute to Birks Group Inc.'s diversified revenue streams.

7. Detailed Products

Fine Jewelry

Birks Group Inc. offers a wide range of fine jewelry pieces, including necklaces, earrings, rings, and bracelets, crafted from precious metals and adorned with diamonds and other gemstones.

Timepieces

Birks Group Inc. offers a selection of high-quality timepieces from renowned brands, featuring intricate designs, precise movements, and stylish aesthetics.

Bridal Jewelry

Birks Group Inc. provides an extensive collection of bridal jewelry, including engagement rings, wedding bands, and anniversary gifts, crafted with precision and elegance.

Giftware

Birks Group Inc. offers a variety of luxurious gift items, such as picture frames, vases, and home decor, crafted from fine materials and designed with sophistication.

Custom Jewelry

Birks Group Inc. provides bespoke jewelry design services, allowing customers to create unique, one-of-a-kind pieces tailored to their personal style and preferences.

8. Birks Group Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Birks Group Inc. operates in the luxury jewelry and timepiece industry, where substitutes are limited. However, there is a growing trend towards lab-grown diamonds and sustainable jewelry, which could pose a threat to traditional jewelers like Birks.

Bargaining Power Of Customers

Birks Group Inc. operates in a niche market, catering to high-end customers who are willing to pay premium prices for luxury jewelry and timepieces. This reduces the bargaining power of customers.

Bargaining Power Of Suppliers

Birks Group Inc. relies on a network of suppliers for diamonds, gold, and other precious materials. While the company has established relationships with suppliers, it is still vulnerable to fluctuations in material costs and supply chain disruptions.

Threat Of New Entrants

The luxury jewelry and timepiece industry has high barriers to entry, including significant capital requirements and the need for established relationships with suppliers. This makes it difficult for new entrants to compete with established players like Birks Group Inc.

Intensity Of Rivalry

The luxury jewelry and timepiece industry is highly competitive, with established players like Tiffany & Co. and Cartier competing for market share. Birks Group Inc. must differentiate itself through its brand, product offerings, and customer service to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 100.40%
Debt Cost 4.64%
Equity Weight -0.40%
Equity Cost 7.61%
WACC 4.63%
Leverage -25199.00%

11. Quality Control: Birks Group Inc. passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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A-Score: 2.8/10

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Quality: 5.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

1.08$

Current Price

1.08$

Potential

-0.00%

Expected Cash-Flows