Digi International (DGII): Evaluating the Stock After New eSIM Partnership and Accessory Launch

Digi International (DGII) just doubled down on eSIM, pairing a new SGP.32 compatible accessory with a fresh Simetric partnership that tightens orchestration, security, and lifecycle control across its connected device portfolio.

See our latest analysis for Digi International.

Those back to back eSIM moves arrive as momentum in the stock has clearly turned up, with a roughly 32 percent 1 month share price return feeding into a much stronger year to date share price gain and solid multi year total shareholder returns.

If this kind of connected device story has your attention, it might be worth scanning other tech names riding similar trends through high growth tech and AI stocks for fresh ideas.

With revenue and earnings still growing and shares now sitting almost exactly at the Street’s target, the real debate is whether Digi remains quietly undervalued or if the market is already pricing in the next leg of IoT-driven growth.

Most Popular Narrative Narrative: 30% Undervalued

With Digi International closing at $47.21 against a narrative fair value of about $47.33, the latest storyline leans toward meaningful upside from today’s level.

The analysts have a consensus price target of $40.5 for Digi International based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $50.0, and the most bearish reporting a price target of just $30.0.

Read the complete narrative.

Want to see what justifies that higher fair value, even with divided targets and modestly rising margins? The answers sit in carefully modeled growth, profitability, and a finely tuned discount rate.

Result: Fair Value of $47.33 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, slower recurring revenue growth or extended customer decision cycles could delay key milestones and challenge the upside reflected in today’s valuation.

Find out about the key risks to this Digi International narrative.

Another View: Multiples Flash a Caution Signal

While the narrative fair value and our model point to Digi as undervalued, the earnings multiple tells a different story. At 43.1 times earnings versus a 25.5 fair ratio and lower industry and peer averages, the stock may already be pricing in a lot of good news. Which signal should investors trust?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Digi International Narrative

If you have a different take or want to dig into the numbers yourself, you can build a personalized view of Digi’s story in minutes by using Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Digi International.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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