Will investors continue to stick the boat into Dr Martens PLC (LSE:DOCS) after it releases its full-year results on Wednesday?
The shares currently trade around 210p having floated in January of last year at a price of 370p, before quickly clambering above 500p.
A year after bringing the shoemaker to market, its largest shareholder, private equity group Permira, sold a 6.5% stake at a price of 395p and since then the shares have stumbled badly.
While Permira still owns over 364mln shares, representing around a 36.4% holding, the wider consumer market has unravelled somewhat.
Supply chain difficulties and Covid-lockdown effects have all played their part for the company.
In fiscal third-quarter results back in January, 11% revenue growth was reported, or 15% if the effect of exchange rates is ignored.
This was slower growth than in the first half and was what is normally the group's strongest quarter.
Chief executive Kenny Wilson said at the time that DOCS had "continued to put our long-term custodian approach at the heart of decision making", explaining that this meant prioritising higher-margin direct-to-consumer (DTC) sales from its own website and shops rather than wholesale channels.
There are risks that it could now fall short of expectations of 17.4% growth for the full year.
After prioritising DTC sales over peak trading, broker Peel Hunt said it expects more wholesale deliveries in the fourth quarter, forecasting full year underlying profit (EBITDA) of £256.4mln, with profit before tax of £195.4mln, in line with consensus.
“The main focus will be on the outlook statement and any margin pressure. DOCS is still playing catch-up and it will be mid-autumn before production levels can fully meet demand across all channels,” analyst John Stevenson said.
“With the strength in apparel and footwear sales as consumers rebuild their wardrobes, we expect a solid start to the new year.”
With Covid-weakened trading in Asia Pacific having held back the company in recent quarters, analyst Sophie Lund-yates at Hargreaves Lansdown said “it will be interesting to see how the situation has evolved given lockdowns in China.”
She also noted that growth in America of 6% in the third quarter was weaker than investors or management would have liked.
“This was partly caused by shipping delays, but a longer run of disappointing growth could suggest the brand is losing its potency,” she added.