NasdaqGS:DGII

Stock Analysis Report

Executive Summary

Digi International Inc. provides Internet of Things connectivity products, services, and solutions in North America, Europe, the Middle East, Africa, Asia, and Latin America.

Snowflake

Fundamentals

Flawless balance sheet with acceptable track record.


Similar Companies

Share Price & News

How has Digi International's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

0.7%

DGII

-1.4%

US Communications

1.0%

US Market


1 Year Return

15.3%

DGII

2.4%

US Communications

6.7%

US Market

Return vs Industry: DGII exceeded the US Communications industry which returned 2.4% over the past year.

Return vs Market: DGII exceeded the US Market which returned 6.7% over the past year.


Share holder returns

DGIIIndustryMarket
7 Day0.7%-1.4%1.0%
30 Day-4.5%-5.7%-1.8%
90 Day6.6%-16.0%-1.8%
1 Year15.3%15.3%4.7%2.4%9.1%6.7%
3 Year26.7%26.7%51.6%42.1%46.1%36.6%
5 Year73.7%73.7%95.1%74.7%66.9%48.6%

Price Volatility Vs. Market

How volatile is Digi International's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Digi International undervalued based on future cash flows and its price relative to the stock market?

35.56x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Undervalued: DGII ($13.72) is trading above our estimate of fair value ($10.66)

Significantly Undervalued: DGII is trading above our estimate of fair value.


Price Based on Earnings

PE vs Industry: DGII is poor value based on its PE Ratio (35.6x) compared to the Communications industry average (30.1x).

PE vs Market: DGII is poor value based on its PE Ratio (35.6x) compared to the US market (17.5x).


Price Based on Expected Growth

Low PEG Ratio: DGII is poor value based on its PEG Ratio (1.2x)


Price Based on Value of Assets

PB vs Industry: DGII is good value based on its PB Ratio (1.1x) compared to the US Communications industry average (1.8x).


Next Steps

Future Growth

How is Digi International expected to perform in the next 1 to 3 years based on estimates from 7 analysts?

28.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: DGII's forecast earnings growth (28.7% per year) is above the savings rate (2.7%).

Earnings vs Market: DGII's earnings (28.7% per year) are forecast to grow faster than the US market (14.5% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: DGII's revenue (5.6% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: DGII's revenue (5.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: DGII's Return on Equity is forecast to be low in 3 years time (5.3%).


Next Steps

Past Performance

How has Digi International performed over the past 5 years?

5.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: DGII's earnings have grown by 5.2% per year over the past 5 years.

Accelerating Growth: DGII's earnings growth over the past year (305.6%) exceeds its 5-year average (5.2% per year).

Earnings vs Industry: DGII earnings growth over the past year (305.6%) exceeded the Communications industry 22.8%.


Return on Equity

High ROE: DGII's Return on Equity (3.1%) is considered low.


Return on Assets

ROA vs Industry: DGII's Return on Assets is below or equal to the Communications industry average last year.


Return on Capital Employed

ROCE Improving: DGII's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Digi International's financial position?


Financial Position Analysis

Short Term Liabilities: DGII's short term assets ($177.9M) exceeds its short term liabilities ($35.0M)

Long Term Liabilities: DGII's short term assets (177.9M) exceeds its long term liabilities (5.1M)


Debt to Equity History and Analysis

Debt Level: DGII is debt free.

Reducing Debt: DGII has not had any debt for past 5 years.

Debt Coverage: DGII has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: DGII has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: DGII has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if DGII's debt is covered by short term assets.


Next Steps

Dividend

What is Digi International's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.5%markettop25%3.8%industryaverage2.6%forecastin3Yearsn/a

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: Unable to evaluate DGII's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate DGII's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if DGII's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if DGII's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of DGII's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of Digi International's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Ron Konezny (51yo)

4.8yrs

Tenure

US$1,751,005

Compensation

Mr. Ronald E. Konezny, also known as Ron, has been the Chief Executive Officer and President at Digi International Inc. since December 17, 2014. He serves as the Director of Atlas Financial Holdings Inc. s ...


CEO Compensation Analysis

Compensation vs. Market: Ron's total compensation ($USD1.75M) is about average for companies of similar size in the US market ($USD1.85M).

Compensation vs Earnings: Ron's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.0yrs

Average Tenure

53.5yo

Average Age

Experienced Management: DGII's management team is considered experienced (2 years average tenure).


Board Age and Tenure

1.8yrs

Average Tenure

53yo

Average Age

Experienced Board: DGII's board of directors are not considered experienced ( 1.8 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: DGII insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$35,87519 Aug 19
Terrence Schneider
EntityIndividual
Shares2,636
Max PriceUS$13.61
SellUS$82,27307 Jun 19
Tracy Roberts
EntityIndividual
Role
Senior Key Executive
CIO & VP of Technology Services
Shares7,180
Max PriceUS$11.46
SellUS$353,59721 Feb 19
Jon Nyland
EntityIndividual
Role
Other Key Executive
Vice President of Manufacturing Operations
Shares26,314
Max PriceUS$13.44

Ownership Breakdown


Management Team

  • Ron Konezny (51yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$1.75m
  • Jon Nyland (56yo)

    Vice President of Manufacturing Operations

    • Tenure: 20.5yrs
    • Compensation: US$476.46k
  • Kevin Riley (58yo)

    President of IoT Solutions

    • Tenure: 0.9yrs
    • Compensation: US$747.74k
  • Scott Wilken

    Vice President of Technology

    • Tenure: 2yrs
  • Mike Ueland (51yo)

    President of IoT Products & Services

    • Tenure: 0.9yrs
  • Tracy Roberts (57yo)

    CIO & VP of Technology Services

    • Tenure: 6.3yrs
  • Dave Sampsell (51yo)

    VP of Corporate Development

    • Tenure: 8.5yrs
    • Compensation: US$608.26k
  • Brian Ballenger

    Vice President of Finance & Accounting

    • Tenure: 0.7yrs
  • Jamie Loch

    Senior VP

    • Tenure: 0.4yrs

Board Members

  • Chris Heim (54yo)

    Director

    • Tenure: 1.8yrs
    • Compensation: US$166.27k
  • Ron Konezny (51yo)

    President

    • Tenure: 4.8yrs
    • Compensation: US$1.75m
  • Sally Smith (61yo)

    Independent Director

    • Tenure: 0yrs
    • Compensation: US$166.27k
  • Satbir Khanuja (52yo)

    Chairman of the Board

    • Tenure: 1.8yrs
    • Compensation: US$170.92k
  • Sam Lazarakis (64yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: US$151.59k
  • Hatem Naguib (50yo)

    Director

    • Tenure: 0.7yrs

Company Information

Digi International Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Digi International Inc.
  • Ticker: DGII
  • Exchange: NasdaqGS
  • Founded: 1985
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: US$386.033m
  • Shares outstanding: 28.14m
  • Website: https://www.digi.com

Number of Employees


Location

  • Digi International Inc.
  • 11001 Bren Road East
  • Minnetonka
  • Minnesota
  • 55343
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DGIINasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDOct 1989
DGIDB (Deutsche Boerse AG)YesCommon StockDEEUROct 1989

Biography

Digi International Inc. provides Internet of Things connectivity products, services, and solutions in North America, Europe, the Middle East, Africa, Asia, and Latin America. The company operates in two se ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 23:33
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
Annual Earnings2018/09/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.

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