Digi International Inc (DGII) Stock Analysis
Verdict: HOLD
Rapid ARR growth and expanding FCF support high-margin IoT recurring revenues, but a 56.0x TTM P/E leaves zero room for execution hiccups.
Investment score: 62/100
Analysis as of
Is Digi International Inc stock worth reviewing? The TradeMates thesis
TradeMates assigns DGII an Investment Score of 62/100 (Hold). High ARR expansion and solid FCF generation ($105.3M) are offset by a rich 56.00x P/E multiplier and recent insider profit-taking.
7-factor investment score
- Valuation: 40/100 (weight 20%)
- Financial Health: 80/100 (weight 15%)
- Technical Momentum: 70/100 (weight 15%)
- Earnings Quality: 85/100 (weight 15%)
- Insider Sentiment: 30/100 (weight 10%)
- Analyst Consensus: 72/100 (weight 10%)
- Risk-Adjusted Return: 55/100 (weight 15%)
Digi International Inc opportunities and risks
What speaks for DGII
- Accelerating Annual Recurring Revenue (ARR) through Cloud Software Expansion
What speaks against DGII
- Valuation Vulnerability and Multiple Compression Risk
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| DGII | 56.0x | 5.5x | 25.7x | 63.8% | 9.6% | 4.9% |
| VSAT | n/a | 1.8x | 7.4x | 30.4% | -0.6% | 7.1% |
| AAOI | n/a | 9.7x | n/a | 28.9% | -9.6% | -7.2% |
| ONDS | 62.6x | 20.1x | 36.6x | 43.7% | 96.2% | -4.9% |
| EXTR | 68.7x | 2.3x | 34.2x | 61.5% | 3.3% | 2.1% |
| NTCT | 22.9x | 3.2x | 11.1x | 78.6% | 13.7% | 9.3% |
| Peer median | 22.9x | 3.2x | 11.1x | 43.7% | 3.3% | 2.1% |
Frequently asked questions about Digi International Inc (DGII)
Is DGII stock a good investment?
The TradeMates model rates Digi International Inc as HOLD with an investment score of 62/100. TradeMates assigns DGII an Investment Score of 62/100 (Hold). High ARR expansion and solid FCF generation ($105.3M) are offset by a rich 56.00x P/E multiplier and recent insider profit-taking. This is algorithmic model output, not personal investment advice.
Is DGII stock a buy?
The TradeMates model verdict for DGII is HOLD with an investment score of 62/100. Treat this as a model signal to review, not a personal buy recommendation.