Dr Martens (LSE: DOCS) shares got an early almost-6% boost Tuesday morning (19 May), after the iconic fashion brand cheered shareholders with results for the 2026 financial year.
In the words of CEO Ije Nwokorie: “In FY26 we returned the business to profit growth, delivering a 61% increase in adjusted PBT, with revenue in line with guidance, and made good progress pivoting the business to a consumer‑first operating model.”
We’re still looking at an 84% share price fall since the company via public with an IPO just over five years ago in January 2021. But is this the start of the turnaround investors have been waiting for?
What went wrong?
Doctor Marten gave his boots to the world,
so that everybody could be free,
They’re classless, matchless, heat-resistant, waterproof,
And retail for only 19 pounds and 99p.”— Alexei Sayle, 1982
I’ve been wearing DMs since my teens, which is a very long time. And that’s part of the problem. The clunky old boots still appeal to clunky old blokes — well, and some others.
But for many younger shoppers, the focus has moved to trainers, ‘athleisure’, and other lightweight footwear. And with inflation hitting discretionary spending — especially in the company’s US market — demand dried up. And profits slumped.
Then in came new CEO Ije Nwokorie in early 2025.
What’s going right?
This time, shoes “were the standout performer, up 19%.” And the Americas pivoted to become the best-performing region.
Nwokorie told us: “Desire for the Dr. Martens Brand continues to grow, with more collaborators approaching us, increased wholesale partner support, strong consumer response to new product families, and an excited reaction from the market to our first beacon store on Brewer Street, London.”
So, brand focus, collaborations and partnerships, improved operating model… it all seems to be coming good.
What happens next?
The company didn’t provide any specific revenue or profit guidance for the new 2027 financial year, just speaking of a “plan to deliver further strong PBT growth in FY27, driven by operational leverage.”
As well as the changes mentioned above, a tight focus on cost management is still key. And seeing talk of “good visibility of our supply chain costs for the majority of FY27,” my optimism is growing.
If management doesn’t put any figures on it yet, forecasters do. They see earnings growing enough to drop Dr Martens’ price-to-earnings (P/E) ratio down to 10 by 2028. That would be quite an achievement, if it comes off.
The 2.55p dividend, yielding 4% at Monday’s close, is expected to remain flat over the same timescale. That sounds like sensible cash management.
What should we watch?
Net debt fell by year-end, to £213.5m from £249.5m a year ago. That’s well within the company’s financial covenants. And the figure does include lease liabilities — which can make it seem worse than it really is. But I’ll definitely keep an eye on it.
My take? We’re still a bit too early in the recovery for me to buy right now — and plenty could still go wrong. But I can see why many investors might consider Dr Martens shares on the back of this update.
Alan Oscroft holds no position in the companies mentioned.
