Digital Brands Announces Reverse Stock Split, Sparks Retail Chatter

Digital Brands Group Inc. ($DBGI), a luxury lifestyle apparel retailer, has announced a reverse stock split for its common shares, with retail chatter rising.

The reverse stock split, a 1-for-50 ratio, went into effect on Thursday last week. 

Following the split, the total number of outstanding shares is now 817,872.

The split came as the company’s stock came under pressure, seeing a decline of 97.65% year-to-date, Investing.com reported, citing 14 warning signals about the company's performance and financial health.

“This reverse stock split is a strategic step towards regaining compliance with Nasdaq’s listing requirements,” stated Hil Davis, CEO of Digital Brands Group.

DBG’s common stock is trading on Nasdaq under the symbol “DBGI,” the company said.  The new CUSIP number for the common stock following the reverse split is  25401N507.

Following the news, message volume on Stocktwits about the retailer rose by 80% in over one day.

One Stocktwits user was expecting the stock to get renewed investor interest before any new dilution started.

Another user pointed to $3.85 as a key resistance level on a 5-minute chart.

Digital Brands has numerous brands including direct-to-consumer and wholesale. It claims its business model is a digitally native-first vertical brand.

Digital Brands stock is up 56% year-to-date.

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