DIGI INTERNATIONAL INC (DGII) Stock Fundamental Analysis
NASDAQ:DGII - Nasdaq - US2537981027 - Common Stock - Currency: USD
Overall DGII gets a fundamental rating of 6 out of 10. We evaluated DGII against 49 industry peers in the Communications Equipment industry. DGII scores excellent on profitability, but there are some minor concerns on its financial health. DGII has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year DGII was profitable.
In the past year DGII had a positive cash flow from operations.
In the past 5 years DGII has always been profitable.
Each year in the past 5 years DGII had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 4.48%, DGII is in the better half of the industry, outperforming 73.47% of the companies in the same industry.
DGII has a better Return On Equity (6.03%) than 75.51% of its industry peers.
DGII has a better Return On Invested Capital (5.52%) than 73.47% of its industry peers.
DGII had an Average Return On Invested Capital over the past 3 years of 4.84%. This is significantly below the industry average of 11.24%.
The 3 year average ROIC (4.84%) for DGII is below the current ROIC(5.52%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.48% | ||
| ROE | 6.03% | ||
| ROIC | 5.52% |
ROA(3y)2.67%
ROA(5y)2.25%
ROE(3y)4.11%
ROE(5y)3.36%
ROIC(3y)4.84%
ROIC(5y)3.62%
1.3 Margins
Looking at the Profit Margin, with a value of 8.45%, DGII belongs to the top of the industry, outperforming 83.67% of the companies in the same industry.
DGII's Profit Margin has improved in the last couple of years.
The Operating Margin of DGII (11.69%) is better than 81.63% of its industry peers.
In the last couple of years the Operating Margin of DGII has grown nicely.
Looking at the Gross Margin, with a value of 60.03%, DGII belongs to the top of the industry, outperforming 83.67% of the companies in the same industry.
In the last couple of years the Gross Margin of DGII has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 11.69% | ||
| PM (TTM) | 8.45% | ||
| GM | 60.03% |
OM growth 3Y44.91%
OM growth 5Y23.58%
PM growth 3Y16.34%
PM growth 5Y6.17%
GM growth 3Y2.95%
GM growth 5Y4.71%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), DGII is destroying value.
Compared to 1 year ago, DGII has more shares outstanding
The number of shares outstanding for DGII has been increased compared to 5 years ago.
Compared to 1 year ago, DGII has an improved debt to assets ratio.
2.2 Solvency
DGII has an Altman-Z score of 4.29. This indicates that DGII is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 4.29, DGII belongs to the best of the industry, outperforming 81.63% of the companies in the same industry.
The Debt to FCF ratio of DGII is 1.04, which is an excellent value as it means it would take DGII, only 1.04 years of fcf income to pay off all of its debts.
DGII has a Debt to FCF ratio of 1.04. This is in the better half of the industry: DGII outperforms 73.47% of its industry peers.
DGII has a Debt/Equity ratio of 0.16. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.16, DGII perfoms like the industry average, outperforming 53.06% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 1.04 | ||
| Altman-Z | 4.29 |
ROIC/WACC0.56
WACC9.82%
2.3 Liquidity
A Current Ratio of 1.61 indicates that DGII should not have too much problems paying its short term obligations.
DGII has a worse Current ratio (1.61) than 63.27% of its industry peers.
A Quick Ratio of 1.06 indicates that DGII should not have too much problems paying its short term obligations.
DGII has a Quick ratio of 1.06. This is in the lower half of the industry: DGII underperforms 67.35% of its industry peers.
The current and quick ratio evaluation for DGII is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.06 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 0.50% over the past year.
Measured over the past years, DGII shows a very strong growth in Earnings Per Share. The EPS has been growing by 52.66% on average per year.
The Revenue has decreased by -4.47% in the past year.
DGII shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.78% yearly.
EPS 1Y (TTM)0.5%
EPS 3Y87.89%
EPS 5Y52.66%
EPS Q2Q%4.17%
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y11.17%
Revenue growth 5Y10.78%
Sales Q2Q%-2.1%
3.2 Future
Based on estimates for the next years, DGII will show a small growth in Earnings Per Share. The EPS will grow by 5.10% on average per year.
Based on estimates for the next years, DGII will show a small growth in Revenue. The Revenue will grow by 3.32% on average per year.
EPS Next Y1.4%
EPS Next 2Y3.58%
EPS Next 3Y5.1%
EPS Next 5YN/A
Revenue Next Year-0.13%
Revenue Next 2Y2.33%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 13.93, DGII is valued correctly.
DGII's Price/Earnings ratio is a bit cheaper when compared to the industry. DGII is cheaper than 77.55% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.29. DGII is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 13.11, DGII is valued correctly.
DGII's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. DGII is cheaper than 73.47% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 20.42, DGII is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.93 | ||
| Fwd PE | 13.11 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, DGII is valued a bit cheaper than 71.43% of the companies in the same industry.
DGII's Price/Free Cash Flow ratio is rather cheap when compared to the industry. DGII is cheaper than 83.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.27 | ||
| EV/EBITDA | 13.28 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of DGII may justify a higher PE ratio.
PEG (NY)9.93
PEG (5Y)0.26
EPS Next 2Y3.58%
EPS Next 3Y5.1%
5. Dividend
5.1 Amount
DGII does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
27.99
-0.04 (-0.14%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryCommunications Equipment
Earnings (Last)
Earnings (Next)
Inst Owners100.78%
Inst Owner Change-0.43%
Ins Owners1.67%
Ins Owner Change13.15%
Market Cap1.03B
Analysts80
Price Target36.98 (32.12%)
Short Float %5.47%
Short Ratio9.11
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.81%
Min EPS beat(2)-1.13%
Max EPS beat(2)2.74%
EPS beat(4)2
Avg EPS beat(4)0.97%
Min EPS beat(4)-1.13%
Max EPS beat(4)3.09%
EPS beat(8)6
Avg EPS beat(8)4.07%
EPS beat(12)10
Avg EPS beat(12)8.08%
EPS beat(16)14
Avg EPS beat(16)12.42%
Revenue beat(2)0
Avg Revenue beat(2)-1.6%
Min Revenue beat(2)-2.16%
Max Revenue beat(2)-1.04%
Revenue beat(4)0
Avg Revenue beat(4)-1.71%
Min Revenue beat(4)-2.33%
Max Revenue beat(4)-1.04%
Revenue beat(8)2
Avg Revenue beat(8)-0.75%
Revenue beat(12)6
Avg Revenue beat(12)0.88%
Revenue beat(16)9
Avg Revenue beat(16)0.84%
PT rev (1m)-1.23%
PT rev (3m)-2.29%
EPS NQ rev (1m)0.28%
EPS NQ rev (3m)0.57%
EPS NY rev (1m)-0.79%
EPS NY rev (3m)0.63%
Revenue NQ rev (1m)-0.03%
Revenue NQ rev (3m)-1.17%
Revenue NY rev (1m)-0.23%
Revenue NY rev (3m)-0.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.93 | ||
| Fwd PE | 13.11 | ||
| P/S | 2.45 | ||
| P/FCF | 11.27 | ||
| P/OCF | 10.97 | ||
| P/B | 1.75 | ||
| P/tB | 463.15 | ||
| EV/EBITDA | 13.28 |
EPS(TTM)2.01
EY7.18%
EPS(NY)2.14
Fwd EY7.63%
FCF(TTM)2.48
FCFY8.87%
OCF(TTM)2.55
OCFY9.11%
SpS11.43
BVpS16.01
TBVpS0.06
PEG (NY)9.93
PEG (5Y)0.26
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.48% | ||
| ROE | 6.03% | ||
| ROCE | 6.99% | ||
| ROIC | 5.52% | ||
| ROICexc | 5.73% | ||
| ROICexgc | 42.63% | ||
| OM | 11.69% | ||
| PM (TTM) | 8.45% | ||
| GM | 60.03% | ||
| FCFM | 21.72% |
ROA(3y)2.67%
ROA(5y)2.25%
ROE(3y)4.11%
ROE(5y)3.36%
ROIC(3y)4.84%
ROIC(5y)3.62%
ROICexc(3y)5.05%
ROICexc(5y)3.91%
ROICexgc(3y)38.34%
ROICexgc(5y)28.01%
ROCE(3y)6.13%
ROCE(5y)4.58%
ROICexcg growth 3Y38.18%
ROICexcg growth 5Y29.38%
ROICexc growth 3Y34.71%
ROICexc growth 5Y12.48%
OM growth 3Y44.91%
OM growth 5Y23.58%
PM growth 3Y16.34%
PM growth 5Y6.17%
GM growth 3Y2.95%
GM growth 5Y4.71%
F-Score6
Asset Turnover0.53
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.16 | ||
| Debt/FCF | 1.04 | ||
| Debt/EBITDA | 1.14 | ||
| Cap/Depr | 7.43% | ||
| Cap/Sales | 0.6% | ||
| Interest Coverage | 3.85 | ||
| Cash Conversion | 113.29% | ||
| Profit Quality | 257.08% | ||
| Current Ratio | 1.61 | ||
| Quick Ratio | 1.06 | ||
| Altman-Z | 4.29 |
F-Score6
WACC9.82%
ROIC/WACC0.56
Cap/Depr(3y)8.22%
Cap/Depr(5y)8.03%
Cap/Sales(3y)0.67%
Cap/Sales(5y)0.61%
Profit Quality(3y)224.85%
Profit Quality(5y)321.51%
High Growth Momentum
Growth
EPS 1Y (TTM)0.5%
EPS 3Y87.89%
EPS 5Y52.66%
EPS Q2Q%4.17%
EPS Next Y1.4%
EPS Next 2Y3.58%
EPS Next 3Y5.1%
EPS Next 5YN/A
Revenue 1Y (TTM)-4.47%
Revenue growth 3Y11.17%
Revenue growth 5Y10.78%
Sales Q2Q%-2.1%
Revenue Next Year-0.13%
Revenue Next 2Y2.33%
Revenue Next 3Y3.32%
Revenue Next 5YN/A
EBIT growth 1Y-1.99%
EBIT growth 3Y61.11%
EBIT growth 5Y36.9%
EBIT Next Year29.82%
EBIT Next 3Y14.25%
EBIT Next 5YN/A
FCF growth 1Y91.57%
FCF growth 3Y13.4%
FCF growth 5Y32.74%
OCF growth 1Y87.12%
OCF growth 3Y12.91%
OCF growth 5Y23.47%