MARKET REPORT: Dr. Martens hits new low after Barclays downgrade

Dr. Martens plunged to a record low as storm clouds gathered over the British bootmaker’s outlook. On a dismal day for investors, Barclays downgraded the stock.

Dr Martens sounded the alarm over a slowdown in trading and supply chain issues in the US during the final quarter of 2022, which then led to the bootmaker issuing several profit warnings this year.

Analysts at Barclays, which also reduced the target price to 140p from 175p, said the company’s prime focus on fixing the issues in America looked challenging while industry data showed a decline in monthly visits to its website.

‘Turning around the US in a weaker macro could mean that there is too much optimism reflected in guidance for a second half recovery, creating further pressure on earnings,’ the analysts added.

Shares, which are at a record low, sank 8.8 per cent, or 10.5p, to 108.3p.

Slipping: Dr. Martens’ listed to great fanfare in January 2021 – at a time when England was already in its third national lockdown

The high hopes that came when Dr Martens floated on the London stock market two years ago appear to be fading. 

The British bootmaker, known for its stylish black work boots with yellow stitching, listed to great fanfare at 370p in January 2021.

Boss Kenny Wilson said at the time: ‘The successful transformation of Dr Martens is a great story, and what is even more exciting is the huge potential ahead.’

Before his arrival in July 2018, the company made a loss of £5.7million in the 12 months to the end of March that year.

However, Wilson oversaw a remarkable turnaround as the firm bounced back to rake in profits of £17.2million a year later and £74.8million in 2020.

The stock was on the slide by October 2021 but regained some of its losses to rally briefly at the start of last year.

Stock Watch – Saietta Group

Saietta Group’s joint business in India landed its second major order for its radial flux technology (RFT) motors that can be fitted into electric vehicles.

Saietta, which makes electric motor technology, will start producing the motors from April next year.

It expects to make around £12.7million of revenue in the first year of production with a minimum of 60,000 orders over a five-year period.

Shares soared 15.2 per cent, or 3p, to 22.75p.

It was a slow start to the week for London’s main markets as the FTSE 100 rose 0.89 per cent, or 65.28 points, to 7425.83 and the FTSE 250 gained 0.34 per cent, or 60.56 points, to 17,913.65. 

That contrasted with the fast-moving drama in Westminster following Rishi Sunak’s watershed cabinet reshuffle that saw the return of former prime minister Lord Cameron.

British insurance giant Phoenix raised its cash generation forecasts after it merged two of its funds. Shares ascended 5.7 per cent, or 26.3p, to 490.5p.

Hammerson shot up 10.2 per cent, or 2.5p, to 27p after Sky News reported that the property landlord is in talks to sell its 40 per cent stake in Value Retail, the owner of Bicester Village, for around £1billion.

There was also good news for Tullow Oil, the Africa and South America-focused fossil fuel company, which secured a £327million five-year debt facility agreement with Glencore.

Shares rose 4.9 per cent, or 1.5p, to 31.9p. Glencore added 0.8 per cent, or 3.35p, to 430.45p.

Naked Wines received some much-needed respite after three board members bought shares in the online alcohol seller.

That included its chairman Rowan Gormley, who bought nearly £40,000 worth of stock.

Shares, which have plunged by more than three-quarters this year, rose 3.8 per cent, or 1.1p, to 29.75p.

Among the top mid-cap fallers were Kainos after the IT Group warned that organisations will show caution and hold back from spending on large-scale projects given the ongoing economic turmoil. 

It also reported that its healthcare revenues plunged 31 per cent to £20.4million in the six months to the end of September as NHS customers saw their budgets squeezed. Shares slumped 22.5 per cent, or 277p, to 955p.

Recruiter FDM Group said its performance for 2024 will be impacted by having fewer consultants assigned to clients than it hoped. Shares tumbled 18 per cent, or 84p, to 383p.

This post first appeared on Dailymail.co.uk