Bank of America Merrill Lynch ups Dr Martens to 'buy'

The bank noted that Dr Martens shares have de-rated by 25% since the IPO.

"We see opportunity to consider the stock given its more robust earnings expectations and signs of a cleaner equity story to come," it said.

BofA ML said the shares are "simply too cheap" and that four profit warnings in the last 12 months and a recent downgrade to medium-term guidance suggest expectations have reset.

The bank also pointed out that changes are on their way. "The group is reinvesting in the business, which should help limit operational surprises, while senior personnel changes are also taking place," it said.

BofA noted that the brand isn’t broken and that its popularity has actually improved. In addition, it forecast return on capital employed above peers.

BofA cut its price target on the stock to 165p from 210p.

At 1515 BST, the shares were up 6.4% at 134.10p.