Digital Brands Group (DBGI) AI Stock Analysis

• Market Cap: $44.37M
• Dividend Yield: N/A
• Average Volume (3M): 21.71K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.63
• Revenue Growth: -26.09%
• EPS Growth: 81.89%
• Country: US
• Employees: 41
• Sector: Consumer Cyclical
• Sector Strength: 57
• Industry: Apparel - Retail
• EPS (TTM): -0.92
• Shares Outstanding: 4,146,494
• 10 Day Avg. Volume: 18,892
• 30 Day Avg. Volume: 21,715
• PEG Ratio: 0.04
• Price to Book (P/B): -21.83
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -15.39
• Enterprise Value/Market Cap: 3.96
• Enterprise Value/Revenue: 3.77
• Enterprise Value/Gross Profit: 49.97
• Enterprise Value/Ebitda: -5.26
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 41 Neutral
• Price Target: ―

Digital Brands Group faces significant financial challenges, with declining revenues, increasing losses, and negative equity, which heavily impact the overall score. While technical indicators show mixed signals, the company's valuation remains unattractive due to its negative P/E ratio. The earnings call and recent corporate events provide some optimism with strategic initiatives and improved financial positioning, but these are yet to significantly mitigate the financial instability and valuation concerns.

Digital Brands Group Business Overview & Revenue Model

Company Description

Digital Brands Group, Inc. provides apparel under various brands on direct-to-consumer and wholesale basis. The company offers denims under the DSTLD brand; and luxury men's suiting under the ACE Studios brand. It also designs, manufactures, and sells women's apparel, such as dresses, tops, jumpsuits, bottoms, sets, jackets, and rompers under the Bailey brand. It offers luxury custom and made-to- measure suiting and sportwear, as well as shirts, jackets, pants, shorts, polos, and other products that are made-to-measure under the Harper & Jones brand. The company also offers luxury T-shirts, tops, and bottoms under the Stateside brand. Digital Brands Group, Inc. sells directly to the consumer through its websites, as well as through its wholesale channel in specialty stores, select department stores, and own showrooms. The company was formerly known as Denim.LA, Inc. Digital Brands Group, Inc. was incorporated in 2012 and is headquartered in Austin, Texas.

How the Company Makes Money

Digital Brands Group makes money primarily through the direct-to-consumer sales of its branded apparel and accessories. The company leverages an e-commerce model, allowing it to reach customers directly through its online platforms. This approach reduces overhead costs associated with traditional retail operations. Additionally, DBGI generates revenue by utilizing data-driven marketing strategies to optimize customer acquisition and retention. The company may also engage in wholesale partnerships, providing its products to other retailers, which further diversifies its revenue streams. Key factors contributing to its earnings include brand recognition, customer loyalty, and strategic marketing initiatives aimed at expanding its consumer base.

Digital Brands Group Financial Statement Overview

Summary

Digital Brands Group is experiencing significant financial pressures with declining revenues, increasing losses, and negative equity. The company faces liquidity challenges with negative operating and free cash flows, relying heavily on external financing. The high leverage and inability to generate profits present substantial risks to financial stability. Strategic initiatives may be necessary to improve operational efficiency and financial health.

Income Statement

Digital Brands Group has faced declining revenue and profitability. The revenue decreased from $14.92M in 2023 to $11.56M in 2024, showing a negative growth rate of approximately -23%. The gross profit margin decreased from 43.87% in 2023 to 31.54% in 2024. The company reported substantial net losses, which increased from -$10.25M in 2023 to -$13.11M in 2024, indicating worsening profitability. Additionally, EBIT and EBITDA margins remain negative, reflecting ongoing operational challenges.

Balance Sheet

The balance sheet shows a negative stockholders' equity of -$1.33M in 2024, indicating insolvency concerns. Total liabilities exceed total assets, and the debt-to-equity ratio cannot be calculated due to negative equity. The return on equity is negative due to consistent net losses. The equity ratio is also negative, highlighting financial instability and excessive leverage.

Cash Flow

The cash flow situation is challenging, with negative operating cash flow of -$6.15M in 2024, worsening from -$6.01M in 2023. Free cash flow remains negative, reflecting ongoing cash flow deficits. The company relies extensively on financing activities, which could pose risks if external funding becomes less accessible.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
9.85M	11.56M	14.92M	13.97M	7.58M	5.24M
	Gross Profit
3.52M	3.64M	6.54M	5.94M	2.90M	553.68K
	EBIT
-11.97M	-10.20M	-2.10M	-15.99M	-31.35M	-7.51M
	EBITDA
-12.28M	-10.20M	-755.03K	-13.77M	-28.57M	-8.51M
	Net Income Common Stockholders
-14.51M	-13.11M	-10.25M	-54.15M	-32.36M	-10.73M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.24M	164.43K	20.77K	1.28M	528.39K	575.99K
	Total Assets
27.24M	19.89M	25.34M	33.74M	36.49M	16.35M
	Total Debt
1.92M	6.55M	8.67M	13.80M	18.62M	14.11M
	Net Debt
-323.57K	6.38M	8.65M	12.53M	18.09M	13.53M
	Total Liabilities
21.02M	21.22M	23.73M	41.19M	43.58M	22.21M
	Stockholders Equity
6.22M	-1.33M	1.60M	-7.45M	-7.09M	-5.86M
Cash Flow		Free Cash Flow
-9.41M	-6.15M	-6.04M	-10.58M	-14.26M	-2.06M
	Operating Cash Flow
-9.42M	-6.15M	-6.01M	-10.57M	-14.22M	-2.06M
	Investing Cash Flow
13.79K	0.00	88.82K	-7.31M	-6.01M	204.88K
	Financing Cash Flow
11.64M	6.30M	4.66M	18.64M	20.18M	2.39M

Digital Brands Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 10.70
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DBGI, the sentiment is Negative. The current price of 10.7 is below the 20-day moving average (MA) of 12.69, above the 50-day MA of 10.54, and above the 200-day MA of 9.20, indicating a neutral trend. The MACD of -0.10 indicates Positive momentum. The RSI at 37.94 is Neutral, neither overbought nor oversold. The STOCH value of 25.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DBGI.

Digital Brands Group Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	62 Neutral	$6.76B	11.07	2.80%	6.34%	2.68%	-24.87%
BIRD	54 Neutral	$90.33M	―	-72.29%	―	-23.63%	41.36%
CATO	47 Neutral	$56.65M	―	-14.43%	23.69%	-7.24%	-69.73%
DLTH	45 Neutral	$74.41M	―	-27.53%	―	-4.21%	-292.04%
TLYS	44 Neutral	$35.88M	―	-47.54%	―	-8.79%	-15.17%
LVLU	42 Neutral	$19.34M	―	-179.00%	―	-11.33%	-183.48%
DBGI	41 Neutral	$44.37M	―	-315.37%	―	-26.09%	81.89%

Digital Brands Group Corporate Events

Digital Brands Group Reports Stockholders’ Equity Surpass $5M

Digital Brands Group, Inc. has announced that as of the date of their current report, their stockholders’ equity exceeds $5 million. This financial update follows various equity offerings and transactions since December 31, 2024, which have been detailed in their filings with the SEC. The unaudited pro forma condensed balance sheet illustrates the impact of these events, reflecting adjustments made to the company’s audited consolidated balance sheet as of December 31, 2024. This development is significant for stakeholders as it indicates an improvement in the company’s financial standing and could influence its market positioning.

Spark’s Take on DBGI Stock

According to Spark, TipRanks’ AI Analyst, DBGI is a Underperform.

Digital Brands Group’s stock faces significant challenges, primarily due to poor financial performance and valuation concerns. Despite positive corporate events and strategic initiatives from the earnings call, the company’s high leverage, liquidity issues, and negative technical indicators heavily impact the overall score.

To see Spark’s full report on DBGI stock, click here.

Digital Brands Group Acquires Open Daily Technologies

On April 1, 2025, Digital Brands Group, Inc. entered into an Asset Purchase Agreement with Open Daily Technologies Inc., acquiring certain intellectual property assets, including patent applications, trademarks, and software products, in exchange for 344,827 shares of common stock. This acquisition, completed on April 2, 2025, aligns with Digital Brands Group’s strategy to enhance digital retail innovation by integrating Open Daily’s virtual shopping solutions, which are designed to improve consumer engagement and optimize online shopping experiences.

Digital Brands Group Announces Equity Surpassing $5 Million

Digital Brands Group, Inc. has announced that its stockholders’ equity now exceeds $5 million as of the date of their latest report. This increase is attributed to various equity offerings and transactions conducted since September 30, 2024. The company has provided an unaudited pro forma condensed balance sheet to illustrate the impact of these events, which occurred after the close of their third fiscal quarter. These developments are significant for the company’s financial positioning and may have implications for stakeholders.

Digital Brands Group Seeks National Exchange Listing

On February 20, 2025, Digital Brands Group announced its application to list its common stock on a national securities exchange, following a $7.5 million capital raise. The uplisting is seen as a strategic move to support further growth initiatives, though the approval of the listing remains uncertain.

Digital Brands Group Announces $7.5M Public Offering

On February 13, 2025, Digital Brands Group announced the pricing of a public offering, raising gross proceeds of $7.5 million. This offering of 11.36 million units, each priced at $0.66, is intended to fund working capital, general corporate purposes, and debt repayment, potentially impacting the company’s operational flexibility and financial health. The offering is expected to close on February 18, 2025.