Digital Brands Group (DBGI) AI Stock Analysis

• Market Cap: $65.34M
• Dividend Yield: N/A
• Average Volume (3M): 460.55K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.63
• Revenue Growth: -35.10%
• EPS Growth: 98.56%
• Country: US
• Employees: 41
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Retail
• EPS (TTM): -1.18
• Shares Outstanding: 8,188,336
• 10 Day Avg. Volume: 126,535
• 30 Day Avg. Volume: 460,552
• PEG Ratio: >-0.01
• Price to Book (P/B): -0.23
• Price to Sales (P/S): 0.03
• P/FCF Ratio: -0.05
• Enterprise Value/Market Cap: 0.49
• Enterprise Value/Revenue: 4.02
• Enterprise Value/Gross Profit: 14.12
• Enterprise Value/Ebitda: -2.42
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 41 Neutral
• Price Target: $8.00 ▼(-53.30% Downside)

The score is primarily constrained by weak financial performance—large operating losses, declining revenue, and ongoing cash burn—creating elevated execution and funding risk. Technicals also lean bearish with the stock below key moving averages and negative MACD. Recent corporate agreements are a positive offset, but they are not yet sufficient to outweigh the weak fundamentals.

Positive Factors

Multi-channel Business Model (DTC + Wholesale)

Operating both direct-to-consumer e-commerce and wholesale channels provides durable revenue diversification. DTC supports higher margins, customer data and lifetime value, while wholesale enables scale and retailer reach—helping stabilize sales as channel mix shifts over months.

Multi-year University Sponsorships Boost Visibility

Multi-year sponsorships and licensing create recurring fee and royalty streams and increase brand awareness in targeted markets. These structural partnerships can drive steady demand, improve lane-to-market for assortments, and support long-term customer acquisition efficiency.

Modest Reported Leverage and Positive Equity

Low leverage and positive equity provide a more durable financing cushion versus highly leveraged peers. This balance sheet flexibility helps the company fund operations, execute strategic agreements, and withstand cyclical apparel volatility without immediate insolvency risk.

Negative Factors

Persistent Cash Burn

Sustained negative operating and free cash flow indicates the business consumes cash to run operations. Over months this forces reliance on external financing or asset sales, raises execution risk, constrains reinvestment in product and marketing, and increases potential dilution.

Declining Revenue and Deep Operating Losses

Revenue contraction coupled with deeply negative operating and net margins signals the core business is unprofitable at scale. Unless gross margin expansion or consistent top-line recovery occurs, structural profitability challenges threaten long-term viability and returns.

Corporate Deals Require Cash and Equity Considerations

Strategic partnerships include stock issuance and cash commitments, which structurally increase funding needs and potential shareholder dilution. Over the medium term, these obligations can strain capital availability and raise financing risk if operating cash flow remains negative.

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

Very weak fundamentals: TTM revenue declined (-9.04%), profitability is deeply negative (EBIT margin ~-113%, net margin ~-165%), and cash flow remains materially negative (operating and free cash flow ~-$14.0M). Balance sheet leverage is modest (debt-to-equity ~0.17) with positive equity (~$16.0M), but returns remain extremely poor (ROE ~-186%) and ongoing cash burn is the dominant risk.

Income Statement

TTM (Trailing-Twelve-Months) revenue declined (-9.04%) and profitability remains very weak, with a gross margin of ~28% but deeply negative operating results (EBIT margin ~-113%) and a net loss that is larger than revenue (net margin ~-165%). While losses have improved versus 2022’s extremely depressed net margin, results deteriorated versus 2023 (when EBITDA briefly turned positive), indicating the turnaround is not yet stable.

Balance Sheet

Leverage looks modest in TTM (debt-to-equity ~0.17) with equity reported positive (~$16.0M), which is a notable improvement from prior years that showed negative equity and distorted leverage metrics. However, returns to shareholders are still very poor (TTM return on equity ~-186%) due to ongoing heavy losses, and the sharp year-to-year swing in equity raises questions about consistency of capitalization versus the still-weak earnings profile.

Cash Flow

Cash generation remains a major issue: TTM operating cash flow is materially negative (~-$14.0M) and free cash flow is also negative (~-$14.0M), implying the business is still consuming cash to operate. Free cash flow improved versus the prior year (strong positive growth rate off a negative base), but cash flow has been negative across all provided periods, leaving continued funding needs as a key risk.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	7.92M	11.56M	14.92M	13.97M	7.58M	5.24M
Gross Profit	2.25M	3.64M	6.54M	5.94M	2.90M	553.68K
EBITDA	-13.15M	-10.20M	449.72K	-13.77M	-28.57M	-8.51M
Net Income	-13.03M	-13.11M	-10.25M	-54.15M	-32.36M	-10.73M
Balance Sheet
Total Assets	41.19M	19.89M	25.34M	33.74M	36.49M	16.35M
Cash, Cash Equivalents and Short-Term Investments	6.70M	164.43K	20.77K	1.28M	528.39K	575.99K
Total Debt	2.75M	6.55M	8.67M	13.80M	18.62M	14.11M
Total Liabilities	25.21M	21.22M	23.73M	41.19M	43.58M	22.21M
Stockholders Equity	15.99M	-1.33M	1.60M	-7.45M	-7.09M	-5.86M
Cash Flow
Free Cash Flow	-13.99M	-6.15M	-6.04M	-10.58M	-14.26M	-2.06M
Operating Cash Flow	-14.01M	-6.15M	-6.01M	-10.57M	-14.22M	-2.06M
Investing Cash Flow	101.08K	0.00	88.82K	-7.31M	-6.01M	204.88K
Financing Cash Flow	26.03M	6.30M	4.66M	18.64M	20.18M	2.39M

Digital Brands Group Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 17.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• 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 17.13 is above the 20-day moving average (MA) of 11.23, above the 50-day MA of 10.22, and above the 200-day MA of 9.80, indicating a bearish trend. The MACD of -1.11 indicates Positive momentum. The RSI at 41.05 is Neutral, neither overbought nor oversold. The STOCH value of 57.01 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 *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
LVLU	54 Neutral	$45.13M	-1.00	-195.23%	―	-12.10%	-44.14%
DLTH	49 Neutral	$87.78M	-2.73	-17.04%	―	-6.40%	11.65%
TLYS	48 Neutral	$45.41M	-1.31	-34.77%	―	-8.31%	36.10%
RENT	45 Neutral	$219.38M	-5.42	―	―	2.91%	94.12%
BIRD	45 Neutral	$29.16M	―	-93.02%	―	-21.98%	35.39%
DBGI	41 Neutral	$65.34M	-0.86	-162.81%	―	-35.10%	98.56%

Digital Brands Group Corporate Events

Digital Brands Group Finalizes Sponsorship Agreement

On December 4, 2025, Digital Brands Group, Inc. finalized a Marketing and Sponsorship Agreement with Buffalo Sports Properties, LLC, which will benefit the company’s products at the University of Colorado’s athletics department. The agreement, effective from December 1, 2025, spans three years and involves an annual sponsorship fee of $550,000, partly paid in company shares. Additionally, the company will pay 7% of gross revenue from a separate licensing agreement with the university to support name, image, and likeness activities. This strategic partnership aims to strengthen the company’s market positioning and engagement with the university’s athletics department.

Digital Brands Group Signs Exclusive Manufacturing Deal

On November 19, 2025, Digital Brands Group, Inc. entered into an Exclusive Private Label Manufacturing Agreement with The Grove Collective, LLC, to produce knit apparel products for the University of Mississippi. The agreement, lasting three years with potential extensions, involves a $3 million stock issuance to The Grove Collective and a commitment to invest in student-athlete funds and marketing efforts. The company retains design discretion and agrees to protect the stock value for the first 15 months, reflecting a strategic move to enhance its market positioning and stakeholder engagement.