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1. Company Snapshot

1.a. Company Description

Dr. Martens plc designs, develops, procures, markets, sells, and distributes footwear in Europe, the Middle East, Africa, the Americas, and the Asia-Pacific.Its product segments include originals, fusion, kids, and casual, as well as accessories.The company offers its products under the Dr. Martens brand name.


Dr. Martens plc was founded in 1945 and is based in London, the United Kingdom.

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1.b. Last Insights on DOCS

The recent 3-month performance of Dr. Martens plc was driven by a strategic shift under its new CEO, Ije Nwokorie, who aims to broaden the company's focus beyond its core boots to include shoes, sandals, and bags. This strategy is expected to drive growth, as evident from the company's positive trading in its Americas direct-to-consumer channel, driven by full-price sales. Additionally, Dr. Martens' fall order books are reported to be "healthy" as the new fiscal year starts in-line with expectations. The company's debt reduction and cost savings efforts have also set the stage for future growth. Furthermore, Dr. Martens has forecast a return to profit growth in the current financial year, backed by its new CEO's strategy shift.

1.c. Company Highlights

2. Delivering on Strategy with Revenue Growth and Margin Expansion

The company reported revenue of £327.3 million, a modest growth of £2.7 million year-on-year, driven by a focus on full-price sales and a reduction in markdown sales. The gross margin has improved, driven by strong average selling price and better cost of goods, particularly freight costs, resulting in a £5.3 million gross margin increase. The operating profit swung from a loss of £3.1 million last year to a profit of £3.4 million this year. Earnings per share (EPS) came in at -0.009, beating estimates of -0.0096. The company's cash flow and net debt position have improved year-on-year, with a reduction in net bank debt of £33 million to £154 million.

Publication Date: Nov -29

📋 Highlights
  • Operating Profit Turnaround: Operating profit swung from a £6.5M loss to a £3.4M profit YoY, driven by gross margin improvements and cost control.
  • DTC Full-Price Growth: DTC full-price revenue rose 6% YoY, with a 5% increase in full-price vs. clearance mix and 10% higher new consumer acquisition at full price.
  • South Korea Performance: Revenue surged 30% YoY in H1, with 65% growth in full-price revenue and a 25% mix improvement, driven by product localization and premium offerings.
  • Debt Reduction: Net bank debt fell £33M to £154M YoY, and total debt (including leases) dropped £46M to £302M, with guidance for net debt near £200M.
  • Product Momentum: Shoes saw 20% DTC and 33% total pairs growth, led by the 1460 Rain Boots and Lowell shoe family, while sandal innovation remains a focus area.

Regional Performance

The regional and channel performance was in line with expectations, with continued DTC growth in Americas, overall performance in APAC, and better performance in wholesale sales. The Americas e-commerce grew by 15.7%, driven by increased footfall, with full-price revenue up 20%. The company is making good progress in executing its strategy, pivoting the business towards a consumer mindset, and giving people more ways and reasons to buy more of their products.

Valuation and Outlook

With a P/S Ratio of 0.95 and an EV/EBITDA of 9.01, the company's valuation appears reasonable. The Dividend Yield is 3.3%, providing a relatively stable return. Analysts estimate next year's revenue growth at 0.5%. The company's strategy is focused on long-term decisions while controlling costs and financials in the short term. As Ije Nwokorie stated, "We're making good progress in each of these areas. In consumer, we're reducing reliance on discounts and making progress in both wholesale and DTC." With a Net Debt / EBITDA of 2.25, the company's leverage is manageable.

Growth Opportunities

The company has significant opportunities for growth in existing markets and new ones, with the company currently only holding 0.7% of the $180 billion relevant market in their 15 top markets. The company is confident in its plans for the upcoming trading weeks, with a strong sandal offering and opportunities to make a profit in the more expensive segments in EMEA.

3. NewsRoom

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Dr Martens to raise prices in the US because of tariff hit

Nov -20

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Dr Martens warns over US tariff hit

Nov -20

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Gen Phoenix and Dr. Martens Celebrate Four Seasons of Waste Reduction with the Launch of the Solar Flare Collection

Nov -12

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3 UK Stocks Estimated To Be Trading At Discounts Of Up To 49.2%

Nov -12

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Dr. Martens plc (LON:DOCS) Stock Is Going Strong But Fundamentals Look Uncertain: What Lies Ahead ?

Nov -03

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UK Stocks That May Be Trading Below Their Estimated Value In October 2025

Oct -14

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How the Latest Developments Are Shaping the Story and Valuation of Dr. Martens

Oct -09

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Dr. Martens enters UAE with Beside Group, expands in Latin America

Oct -03

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.51%)

6. Segments

Wholesale

Expected Growth: 4.85%

Strong demand for comfort footwear, increased online sales, and successful product innovations drive Dr. Martens' wholesale growth. Expansion into new markets, particularly in Asia, and strategic partnerships with key retailers also contribute to the 4.85% growth. Furthermore, the brand's focus on sustainability and digital marketing efforts enhance its appeal to environmentally conscious and younger consumers.

Ecommerce

Expected Growth: 10.5%

Dr. Martens' 10.5% ecommerce growth driven by strong brand recognition, effective digital marketing, and seamless online shopping experiences. Strategic partnerships with popular online marketplaces and social media platforms also contributed to the growth. Additionally, the company's focus on product innovation, quality, and sustainability resonated with customers, leading to increased online sales and loyalty.

Retail

Expected Growth: 9.33%

Dr. Martens' 9.33% retail growth is driven by strong e-commerce performance, successful store openings, and effective marketing strategies. The brand's appeal to younger generations, increased focus on comfort and sustainability, and expansion into new markets also contribute to its growth. Additionally, the company's ability to adapt to changing consumer behavior and invest in digital capabilities has enabled it to stay ahead in the competitive retail landscape.

7. Detailed Products

AirWair Boots

Dr. Martens' iconic air-cushioned boots, known for their comfort, durability, and style.

Sandals

Comfortable and stylish sandals for warm weather, featuring contoured footbeds and adjustable straps.

Shoes

A wide range of shoes, including oxfords, brogues, and loafers, offering comfort and style.

Accessories

A variety of accessories, such as bags, belts, and socks, to complement Dr. Martens footwear.

Care Products

Specialized care products, including cleaners, conditioners, and protectants, to maintain and protect Dr. Martens footwear.

8. Dr. Martens plc's Porter Forces

Forces Ranking

Threat Of Substitutes

Dr. Martens plc faces moderate threat from substitutes, as customers have alternative options for footwear and accessories. However, the brand's strong reputation and loyal customer base mitigate this threat to some extent.

Bargaining Power Of Customers

Dr. Martens plc's customers have relatively low bargaining power due to the brand's strong market position and loyal customer base. Customers are willing to pay a premium for the brand's products, reducing their bargaining power.

Bargaining Power Of Suppliers

Dr. Martens plc's suppliers have moderate bargaining power due to the company's dependence on a few key suppliers for raw materials. However, the company's strong relationships with suppliers and its ability to negotiate prices mitigate this threat.

Threat Of New Entrants

The threat of new entrants is low for Dr. Martens plc due to the high barriers to entry in the footwear industry, including significant capital requirements and the need for established distribution networks.

Intensity Of Rivalry

The footwear industry is highly competitive, with many established brands competing for market share. Dr. Martens plc faces intense rivalry from competitors such as Vans, Converse, and Adidas, which can lead to pricing pressures and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 44.30%
Debt Cost 3.99%
Equity Weight 55.70%
Equity Cost 3.99%
WACC 3.99%
Leverage 79.54%

11. Quality Control: Dr. Martens plc 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

Stock-Card
Clas Ohlson

A-Score: 5.7/10

Value: 3.2

Growth: 6.2

Quality: 7.1

Yield: 5.0

Momentum: 10.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Rocky Brands

A-Score: 5.1/10

Value: 7.8

Growth: 5.6

Quality: 5.4

Yield: 4.0

Momentum: 5.5

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Dr. Martens

A-Score: 4.9/10

Value: 4.9

Growth: 4.0

Quality: 3.9

Yield: 5.6

Momentum: 10.0

Volatility: 1.0

1-Year Total Return ->

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Stock-Card
Fiskars

A-Score: 4.4/10

Value: 3.5

Growth: 2.4

Quality: 2.5

Yield: 8.1

Momentum: 2.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Delta Plus

A-Score: 4.2/10

Value: 6.7

Growth: 6.0

Quality: 4.8

Yield: 2.5

Momentum: 1.0

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
TOD'S

A-Score: 3.5/10

Value: 5.0

Growth: 5.8

Quality: 3.5

Yield: 0.0

Momentum: 4.0

Volatility: 3.0

1-Year Total Return ->

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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

0.78$

Current Price

0.78$

Potential

-0.00%

Expected Cash-Flows