Harsh words for a company that’s happily been the butt of many jokes since 1774 (you still paying $135 to look like you attended the last supper?). Birkenstock is expected to start trading tomorrow (Oct. 11) under the tickerBIRK

with a potential valuation of up to $9.2B — nearly double its $4.8B value when private investors bought it in 2021.

Its popularity is no joke: Birks are one thing all generations can agree on — with boomers, millennials and Gen X each making up nearly one-third of Birks’ sales. Between 2014 and 2022, sales have compounded 20% annually — with the recent popularity of casual fashion (and price increases) sending sales up 29% last year.

The question we should all be asking: Is the company profitable? Yes. But we’re talking about the other important question: How expensive is the company? Depends on what you compare them to. Birks’ 49x price-to-earnings ratio is…

• Fairly-valued compared to Nike (NYSE:NKE) and Lululemon (NASDAQ:LULU) — which trades at 29x and 32x FY2023 multiples.
• Expensive compared to Crocs (NASDAQ:CROX) — which is trading at a third of Birk’s FY2022 price-to-earnings ratio.

That has New Constructs’ CEO David Trainer warning: Don’t ”expect to make any money by buying this IPO” (MW) — who points out their overpriced valuation and that Nike and Deckers (NYSE:DECK) are the only two footwear companies with larger market caps.

There’s another major issue…

Birks is going public at a precarious time when consumers are seemingly on shaky grounds, and retailers are forced to ramp up discounts to attract shoppers.

• Global footwear sales growth has also been slowing in recent years — forecasted to rise 2.9% this year from last year — slower than the 6.8% in 2022, per Euromonitor International.
• Quilter Cheviot’s Consumer Discretionary Analyst, Mamta Valechha, questions whether Birks can create the “desirability… to buy another pair of Birkenstocks” (Reuters).

Scared yet? Since going public last month, Instacart (NASDAQ:CART) and ARM (NASDAQ:ARM) are down 29% and 13%, respectively. While shoemakers On Holding (NYSE:ONON) and Dr Martens (OTC:DOCMF) are down 27% and 74%, respectively, since going public in 2021.