Björn Borg operates in the fashion industry and focuses on the design, manufacture and distribution of sportswear and underwear. The company's products are aimed at private individuals looking for comfortable and stylish clothing. The business is global with a main presence in the Nordic region and Europe. Björn Borg was founded in 1984 and is headquartered in Solna.
Björn Borg has announced a three-year strategic partnership with the Swedish department store Åhléns and the Belgian department store Inno to develop and sell new lifestyle categories. The company estimates that the agreement, which includes existing business, will have a total retail value of 200–300 MSEK over the three-year term. In our view, the partnership is a logical step in Björn Borg’s strategy to broaden its brand presence and product offering, although the immediate financial impact is limited as the first launches are not scheduled until fall 2026. In addition, we have already factored in relatively high sales growth of around 6-8% for the coming years, and given the early phase of the partnership, we are not making any changes to our estimates at this stage, though the partnership could support our current estimates if successful.
Björn Borg delivered strong Q4 earnings, due to solid sales volumes and good cost control. In our view, the outlook for next year is positive, and combined with a strong finish to last year, this has led us to raise our earnings estimates for the coming years. With our updated estimates, the company’s earnings multiples for this year are at the lower end of our acceptable valuation range, with a P/E ratio of around 15x and EV/EBIT of 12x. As a result, we raise our recommendation to Accumulate (prev. Reduce) and increase our target price to SEK 67 per share (prev. SEK 57 per share), mainly due to increased estimates.
Björn Borg delivered Q4 revenue that was in line with our estimates, with the sports apparel category continuing to outperform. The clear positive highlight in the report was the profitability that significantly exceeded our expectations, driven by solid cost control. In our view, for the company to achieve higher growth in line with its targets, it needs to lift the shoe category as well, which has so far underperformed.
Björn Borg will publish its Q4’25 results on Friday, February 13, 2026. We expect the company to report modest top-line growth as it faces tough comparison figures in its largest market, Sweden, alongside a volatile retail environment. While we expect the sports apparel category to remain a growth engine, the overall reported revenue growth will likely be dampened by a strengthening SEK. We anticipate profitability to remain at a solid level, supported by good cost control and favorable currency effects on gross margins.
Preliminary Swedish clothing market data for December sales up to the 16th were down 8.4%. Although we believe that the figures was relativley weak, the period is quite short, so it can be affected by various factors such as the timing of Black Week sales.
Björn Borg’s Q3 report was overall roughly in line with our estimates. In our view, the company continues to show good revenue growth, but it does not come without cost as gross margins (FX adj.) have declined in the past three quarters. At current valuations (2026 P/E: 17x and EV/EBIT: 13x), we would like to see clearer evidence that the company can successfully expand its footwear and sports apparel category while maintaining solid gross margins. As a result, we reiterate our Reduce recommendation but raise our target price to SEK 57 per share (prev. SEK 55), mainly due to a slight increase in short-term earnings estimates.
