On Thursday, DBGI announced it will start accepting cryptocurrencies as a form of payment across all its brands starting in the middle of November. More specifically, they will leverage the
Moreover, recent IPO's show DBGI is spot-on in its assessment of the power of digital sales. Within the past month, a couple of big deals brought two Direct To Consumer companies public, including
Sector IPO's Expose Valuation Disconnect
The best part of the story, at least from a DBGI investor's perspective, is that the markets welcomed these IPO's with open arms.
Indeed, the bullish sentiment can be contagious. And with things generally happening in three's, there's a good chance that DBGI can ride the tailwind of the institutional interest given the two other companies mentioned. They should. In addition to accretive acquisitions since its IPO, DBGI has posted impressive growth across its board of brands.
Moreover, they keep getting stronger. Last month, DBGI added Stateside apparel to its portfolio and followed that deal offering revenue guidance between
If it does, the news should be excellent for DBGI investors. The AKA IPO provided about a 5X revenue multiple. The Solo multiple was also aggressive. But, using the 5X as a variable, current revenue expectations put a more appropriate valuation for DBGI stock near the
In fact, after announcing the launch of its
History Repeats for DBGI Stock
And, that was again the case on Thursday. After announcing its acceptance of cryptocurrency through the Shopify platform, shares surged by 17% intraday to
Indeed, the revenues are different, but the multiples provided can be similar at the end of the day. And with little debt, a low share count, and an S-1 indicating additional acquisitions may be near, the stage is well set for DBGI to generate and sustain serious share price traction. Even better, it's not all blue-sky expectations. DBGI can justify a higher share price based on real revenues, a solid balance sheet, and a plan that allows the company to continue to capitalize on opportunities through its scalable business model.
Remember, too, other companies are proving the sector out as well.
Still, that may be an option but likely not necessary. All of its brands are performing well, and the company expects to become EBITDA positive in 2022. That goal is likely expedited by an aggressive marketing campaign that is already generating impressive results. As noted, Bailey 44 saw a 379% surge and DSTLD a 52% jump in revenues off of just a small percentage of the budgeted ad spend budget. To date, DBGI has spent only about
A Trendy DBGI Brand Portfolio
There's even better news for those just introduced to DBGI. They are a company in motion. And their momentum started back in August when DBGI noted that DSTLD inventories were building to meet a considerable increase in demand. Better still, its Bailey 44 brand is enjoying the same trend higher, experiencing robust increases in wholesale booking orders that DBGI said were approaching wholesale order levels that compare favorably to pre-COVID levels.
Moreover, those increases came with a tailwind. Now, with additional revenue-generating firepower from Stateside in the mix, the guidance toward
Fashionable In Green
Indeed, it's been a good two months to date for DBGI investors. But, the gains could be a prelude to better things to come. And with DTC and AKA brands showing that investors are putting digital apparel company stocks in fashion, a return to 52-week highs of
Hence, even after its 44% Oct-Nov jump, DBGI still presents a compelling investment opportunity based on intrinsic and inherent strengths. But, as noted, the value window for DBGI has a tendency to close quickly. Thus, doing some DD on this company and then taking action where the facts lead could generate healthy returns. Better still, from another perspective, investors would be in fashion as well.
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