Forensic Analysis · Retail / Consumer Discretionary · as of Oct 25, 2026
Digital Brands Group, Inc. (DBGI)
A forensic read on Digital Brands Group, Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
F · Poor — capital at risk
Forensic grade
Distress
Financial health
-16.4
Distress distance
Clean
Earnings quality
4
Forensic signals
-759.5%
ROE
-36.1%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (red flags, auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Digital Brands Group, Inc. earns an F (Poor — capital at risk) forensic quality grade, and its balance-sheet distress test reads -16.4, placing it in the Distress zone. 4 forensic signals were flagged in its latest SEC filings, led by accruals ratio (% of NOA).
What the filings flag
+91.8%
FY2024→FY2025
Accruals ratio (% of NOA).Net operating assets grew +91.8% relative to their own average in FY2025 — scaled by NOA itself, not by total assets, which is what the Forensic Screens card's own accrual row divides by. Accruals are building sharply — a large slice of profit sits in operating assets, not cash. An accrual is a claim that still has to be collected or written down, so the gap resolves in a later period whichever way it goes. Net operating assets also rose $2.9M through acquisitions (shares issued for businesses); that purchase is investing and is excluded from this ratio. A cash-flow measure on the same base disagrees: reported earnings ran behind operating cash by 103% of net operating assets, against an accruals ratio of 91.8%. The two are computed differently: the accruals ratio is the change in net operating assets over average net operating assets, while the cash-flow figure is net income less operating cash flow over that same average. Read them as two results, not one.
+2397.0%/yr
FY2023–FY2025
Share-count dilution.Diluted share count changed +62249% over the last 2 years to FY2025 (+2397.0%/yr). The count is growing — 0.0M shares in FY2023, 14.0M in FY2025: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~2397.0% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2023 has been diluted ~100%.
0.0% of rev
FY2025
Stock-based comp load.Stock-based compensation ran 0.0% of revenue in FY2025 — about $0.00 per diluted share. No cash left the business to pay it, which is why operating cash flow adds it back. Net of repurchases the diluted count still rose about 2397.0% a year across FY2023–FY2025 and that rate is not falling, so total profit has to grow by that much annually before any of it reaches a share. Stock compensation is one source of that issuance; acquisition consideration, equity raises, convertibles and other employee plans also net into the count, and these figures do not separate them.
$3M
FY2025
Goodwill impairments.Took $3M of goodwill writedowns across 1 year (FY2025 ($3M)). Writedowns mean past acquisitions underperformed what was paid for them.
Key fundamentals
Latest Revenue$7.4M
Revenue Growth YoY-36.1%
Revenue CAGR (2yr)-29.7%
Net Margin-382.8%
Return on Equity-759.5%
Debt / Equity1.40x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Digital Brands Group, Inc.'s actual 10-K/10-Q/8-K filings?