NasdaqGS:DGII

Stock Analysis Report

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Executive Summary

Digi International Inc. provides business and mission-critical Internet of Things (IoT) products, services, and solutions in the United States and internationally. More Details


Snowflake Analysis

Excellent balance sheet with moderate growth potential.


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

Stable Share Price: DGII is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: DGII's weekly volatility (6%) has been stable over the past year.


Market Performance


7 Day Return

5.8%

DGII

4.1%

US Communications

2.8%

US Market


1 Year Return

-0.2%

DGII

-4.1%

US Communications

20.9%

US Market

Return vs Industry: DGII exceeded the US Communications industry which returned -4.1% over the past year.

Return vs Market: DGII underperformed the US Market which returned 20.7% over the past year.


Shareholder returns

DGIIIndustryMarket
7 Day5.8%4.1%2.8%
30 Day18.4%17.8%11.1%
90 Day29.9%1.4%6.5%
1 Year-0.2%-0.2%-1.5%-4.1%23.6%20.9%
3 Year78.9%78.9%15.9%7.8%47.3%37.6%
5 Year41.2%41.2%57.3%39.5%94.3%72.9%

Long-Term 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 compared to its fair value and its price relative to the market?

20.0%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: DGII ($17.8) is trading below our estimate of fair value ($22.25)

Significantly Below Fair Value: DGII is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: DGII is poor value based on its PE Ratio (61.1x) compared to the US Communications industry average (37.2x).

PE vs Market: DGII is poor value based on its PE Ratio (61.1x) compared to the US market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: DGII is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: DGII is good value based on its PB Ratio (1.4x) compared to the US Communications industry average (1.8x).


Next Steps

Future Growth

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

39.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: DGII's forecast earnings growth (39.5% per year) is above the savings rate (2.2%).

Earnings vs Market: DGII's earnings (39.5% per year) are forecast to grow faster than the US market (22% per year).

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

Revenue vs Market: DGII's revenue (7.5% per year) is forecast to grow slower than the US market (10.2% per year).

High Growth Revenue: DGII's revenue (7.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: DGII's Return on Equity is forecast to be low in 3 years time (7.9%).


Next Steps

Past Performance

How has Digi International performed over the past 5 years?

-11.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: DGII has a large one-off loss of $2.8M impacting its September 30 2020 financial results.

Growing Profit Margin: DGII's current net profit margins (3%) are lower than last year (3.9%).


Past Earnings Growth Analysis

Earnings Trend: DGII's earnings have declined by 11.9% per year over the past 5 years.

Accelerating Growth: DGII's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: DGII had negative earnings growth (-15.1%) over the past year, making it difficult to compare to the Communications industry average (-4.9%).


Return on Equity

High ROE: DGII's Return on Equity (2.3%) is considered low.


Next Steps

Financial Health

How is Digi International's financial position?


Financial Position Analysis

Short Term Liabilities: DGII's short term assets ($170.1M) exceed its short term liabilities ($61.2M).

Long Term Liabilities: DGII's short term assets ($170.1M) exceed its long term liabilities ($96.0M).


Debt to Equity History and Analysis

Debt Level: DGII's debt to equity ratio (16.4%) is considered satisfactory.

Reducing Debt: Insufficient data to determine if DGII's debt to equity ratio has reduced over the past 5 years.

Debt Coverage: DGII's debt is well covered by operating cash flow (56.6%).

Interest Coverage: DGII's interest payments on its debt are well covered by EBIT (4.3x coverage).


Balance Sheet


Next Steps

Dividend

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


Dividend Yield vs Market

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

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


Stability and Growth of Payments

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

How experienced are the management team and are they aligned to shareholders interests?

2.5yrs

Average management tenure


CEO

Ron Konezny (52 yo)

5.92yrs

Tenure

US$2,017,486

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 Independent Director of Atlas Financial Holding...


CEO Compensation Analysis

Compensation vs Market: Ron's total compensation ($USD2.02M) is about average for companies of similar size in the US market ($USD1.79M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Ronald Konezny
President5.92yrsUS$2.02m0.50%
$ 2.6m
James Loch
Senior VP1.5yrsUS$1.58m0.032%
$ 167.1k
Brian Ballenger
Vice President of Finance & Accounting1.67yrsUS$440.34k0.025%
$ 128.8k
David Sampsell
VP of Corporate Development9.58yrsUS$578.16k0.14%
$ 717.9k
Kevin Riley
President of IoT Solutions2yrsUS$1.04m0.17%
$ 909.5k
Michael Ueland
President of IoT Products & Services2yrsUS$891.82k0.11%
$ 595.8k
Scott Wilken
Vice President of Technology3.08yrsno datano data
Tracy Roberts
CIO & VP of Technology Services7.33yrsno data0.097%
$ 507.0k

2.5yrs

Average Tenure

52yo

Average Age

Experienced Management: DGII's management team is considered experienced (2.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Ronald Konezny
President5.92yrsUS$2.02m0.50%
$ 2.6m
Christopher Heim
Independent Director2.83yrsUS$189.42k0.091%
$ 473.5k
Sally Smith
Independent Director2.83yrsUS$189.42k0.077%
$ 401.8k
Satbir Khanuja
Independent Non-Executive Chairman of the Board2.83yrsUS$226.09k0.20%
$ 1.1m
Spiro Lazarakis
Independent Director5.33yrsUS$195.09k0.15%
$ 801.1k
Hatem Naguib
Independent Director1.67yrsUS$170.93kno data

2.8yrs

Average Tenure

54yo

Average Age

Experienced Board: DGII's board of directors are not considered experienced ( 2.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

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


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 3.3%.


Top Shareholders

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$520.508m
  • Shares outstanding: 29.24m
  • Website: https://www.digi.com

Number of Employees


Location

  • Digi International Inc.
  • 9350 Excelsior Boulevard
  • Suite 700
  • Hopkins
  • 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 business and mission-critical Internet of Things (IoT) products, services, and solutions in the United States and internationally. The company operates in two segments, IoT...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/11/29 00:19
End of Day Share Price2020/11/27 00:00
Earnings2020/09/30
Annual Earnings2020/09/30


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.