Digi International Inc.
Digi International Inc. Fundamental Analysis
Digi International Inc. (DGII) shows weak financial fundamentals with a PE ratio of 44.27, profit margin of 9.45%, and ROE of 6.76%. The company generates $0.5B in annual revenue with weak year-over-year growth of 1.46%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 43.7/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze DGII's fundamental strength across five key dimensions:
Efficiency Score
WeakDGII struggles to generate sufficient returns from assets.
Valuation Score
WeakDGII trades at a premium to fair value.
Growth Score
ModerateDGII shows steady but slowing expansion.
Financial Health Score
ExcellentDGII maintains a strong and stable balance sheet.
Profitability Score
WeakDGII struggles to sustain strong margins.
Key Financial Metrics
Is DGII Expensive or Cheap?
P/E Ratio
DGII trades at 44.27 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, DGII's PEG of 12.17 indicates potential overvaluation.
Price to Book
The market values Digi International Inc. at 2.89 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 18.90 times EBITDA. This signals the market has high growth expectations.
How Well Does DGII Make Money?
Net Profit Margin
For every $100 in sales, Digi International Inc. keeps $9.45 as profit after all expenses.
Operating Margin
Core operations generate 13.20 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $6.76 in profit for every $100 of shareholder equity.
ROA
Digi International Inc. generates $4.62 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Digi International Inc. generates strong operating cash flow of $114.66M, reflecting robust business health.
Free Cash Flow
Digi International Inc. generates strong free cash flow of $114.78M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $3.05 in free cash annually.
FCF Yield
DGII converts 6.03% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
44.27
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
12.17
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.89
vs 25 benchmark
P/S Ratio
Price to sales ratio
4.21
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.24
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.24
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.07
vs 25 benchmark
ROA
Return on assets percentage
0.05
vs 25 benchmark
ROCE
Return on capital employed
0.07
vs 25 benchmark
How DGII Stacks Against Its Sector Peers
| Metric | DGII Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 44.27 | 35.19 | Worse (Expensive) |
| ROE | 6.76% | 1155.00% | Weak |
| Net Margin | 9.45% | -127067.00% (disorted) | Weak |
| Debt/Equity | 0.24 | 0.41 | Strong (Low Leverage) |
| Current Ratio | 1.24 | 4.71 | Neutral |
| ROA | 4.62% | -314918.00% (disorted) | Weak |
DGII outperforms its industry in 1 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Digi International Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
20.25%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
278.67%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
144.41%
Industry Style: Growth, Innovation, High Beta
High Growth