Wall Street ‘Tiger Cub’ bets against Dr Martens
Northamptonshire-founded bootmaker struggles with slowing sales in the US
A Wall Street “Tiger Cub” hedge fund has bet against Dr Martens as the bootmaker struggles with slowing demand in the US.
New York-based Woodson Capital Management has disclosed a £10.5m short position against the London-listed retailer just weeks after the company warned on profits, sending its shares to record lows.
The bet is based on borrowing a 0.5pc stake in Dr Martens. The fund stands to gain if the bootmaker’s shares, down 36pc in the last 12 months, fall further still.
The disclosure will pile further pressure on the retailer, which has seen its share price more than halve since its stock market float in early 2021.
In November, the company warned that it experienced "softening" demand in the US, its largest market where it makes around 40pc of sales.
Woodson Capital is a little known hedge fund based in Manhattan run by Jim Davis, a former analyst at Tiger Management, the fund run by Wall Street grandee Julian Robertson. Many of Mr Robertson’s proteges have gone on to set up hedge funds of their own, dubbed “Tiger Cubs”.
Woodson Capital also holds a multi-million pound short position against British property developer Hammerson.
Dr Martens floated on the London Stock Exchange in early 2021 at 370p a share, valuing it at almost £4bn. The company has a current market value of £2.1bn.
The boot chain took off more than 50 years ago after a Northamptonshire-based family bought an air-cushioned sole from an army doctor to make boots more comfortable. The Griggs family sold a majority stake to private equity firm Permira in 2013 in a deal worth €380m (£281m).
Last year, Permira slashed its holding in the company, in a move that sent Dr Martens' share price tumbling.
The shoes were initially made for workers but became popular with skinheads and punks in the 1960s and 1970s. The brand went on to experience a resurgence in the 1990s with the emergence of Britpop.
In recent years, celebrities including model Gigi Hadid, actresses Kristen Stewart and Emma Watson, and singer Rihanna have all dressed in the footwear.
A spokesman for Dr Martens said: “We have always run this business with a long-term, custodian mindset and will continue that strategy, always taking decisions we believe are in the best long-term interests of the brand and all our stakeholders.”