Goldman Sachs upgrades Dr Martens to 'buy'

Goldman Sachs upped Dr Martens to ‘buy’ from ‘neutral’ on Tuesday, hiking the price target to 535p from 490p.

In a note back in March, the bank had already highlighted three drivers underpinning the company’s growth profile: global expansion, eg in the US and China; enhanced brand control by bringing third party distributor markets in house; expanding DTC sales.

The bank said that it has taken a deeper look at the potential in converting distributor markets, with a particular focus on Italy.

"Using the success that Dr Martens has seen converting Germany two years ago as a reference point, we forecast Italy can achieve forecast Italy can achieve circa £65m of sales by FY23E (versus c£20m in FY21, on our estimates).

"We now forecast that Dr Martens can grow revenue by 23%/18%/16% in FY22/23/24E (versus 19%/16%/15% prior)."

At 1045 BST, the shares were up 2.2% at 456p.