Digital Brands Group, Inc. (DBGI), a company providing apparel on a direct-to-consumer and wholesale basis, has plunged 18.37% in aftermarket trading session. Consequently, the stock was trading at $1.60 when last checked. The decline came as a result of the profit-taking factor after the stock climbed by 47.37% to close the day at $1.96. The stock surged owing to the announcement regarding record revenue generation.
Growth in E-commerce Revenue of DBGI
On Monday, DBGI announced that its eCommerce revenue had grown a tremendous 776% on a year-over-year basis for January and February 2022. Chief Executive Officer of the company, Hil Davis, commented that the result is well above the plan of the company. It depicts the power of the company’s portfolio model. The wholesale channel of the company continues to expand as well, as evident from a greater than 200% increase on a year-over-year basis during January and February.
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Merger Agreement for Sundry
On 20th January 2022, DBGI announced to have signed a definitive merger agreement for the acquisition of Sundry. Sundry is a privately-owned global lifestyle apparel brand. The company said that the merger would come to an end in the first half of the year 2022. Alongside that, the closing conditions and financing would also have an impact upon the merger.
Q4 and FY 2021 Revenue Update
On 7th January 2022, DBGI announced the Q4 and FY 2021 revenue update. The expected revenue for the fourth quarter of the fiscal year 2021 was $4 million. The fiscal year 2021 net revenue is expected to grow by 44% to $7.6 million compared to the $5.2 million for the same fiscal year 2020. The wholesale bookings during the first quarter of 2022 which the consumers booked during the fourth quarter of 2021 increased 125% on a year-over-year basis.
What’s in Store for DBGI?
Analysts are of the view that at the current level, DBGI stock should be considered a hold candidate. It is because even though the stock holds several positive signals, they are not enough for it to be considered for buying. Hence, investors should take a careful decision regarding investment in DBGI stock.