📊 DGII Key Takeaways
Is Digi International Inc. (DGII) a Good Investment?
DGII demonstrates strong operational efficiency with 62.4% gross margins and impressive 28.7% free cash flow margins, indicating excellent cash generation capability. Net income growth of 81.3% YoY despite flat revenue suggests improving operational leverage and margin expansion, though profitability metrics remain modest relative to asset base.
Digi International shows solid fundamental quality in profitability and cash generation, with strong gross margins and very high free cash flow conversion relative to revenue. However, the latest period shows no top-line growth, and the balance sheet, while not heavily levered, still carries only moderate liquidity and relatively thin interest coverage. Overall, the business looks fundamentally stable and improved, but not strong enough on growth quality to justify a more aggressive rating.
Why Buy Digi International Inc. Stock? DGII Key Strengths
- Exceptional free cash flow generation (28.7% FCF margin, $35.2M annually) provides financial flexibility
- Strong net income growth of 81.3% YoY with improving profitability demonstrates operational leverage
- Healthy gross margins of 62.4% indicate strong pricing power and product-market fit
- Conservative leverage with 0.21x debt-to-equity ratio and manageable 2.6x interest coverage
- Strong gross margin of 62.4% supports resilience and pricing power
- Free cash flow generation is robust at $35.17M with a 28.7% FCF margin
- Net income and diluted EPS grew sharply year over year despite flat revenue
DGII Stock Risks: Digi International Inc. Investment Risks
- Flat revenue growth (0.0% YoY) indicates stagnant top-line expansion and potential market maturity
- Low absolute profitability returns: 1.8% ROE and 1.3% ROA suggest capital is not being deployed efficiently despite strong cash generation
- Quick ratio of 0.90x below 1.0x indicates potential short-term liquidity constraints without inventory conversion
- Modest absolute net margin of 9.6% limits reinvestment capacity relative to $918.4M asset base
- Revenue was flat year over year, raising concern about underlying demand and growth durability
- Interest coverage of 2.6x leaves limited cushion if profitability softens or rates remain elevated
- Quick ratio of 0.90x suggests liquidity is adequate but not especially strong
Key Metrics to Watch
- Revenue growth trajectory - must demonstrate top-line expansion to validate operational improvements
- Return on assets and equity - need significant improvement to justify large asset/equity base
- Operating cash flow sustainability - maintain current FCF generation levels above $30M annually
- Gross margin stability - monitor for compression during competitive pricing pressure
- Revenue growth and organic demand recovery
- Interest coverage and operating margin sustainability
Digi International Inc. (DGII) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The 28.7% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments.
DGII Profit Margin, ROE & Profitability Analysis
DGII vs Technology Sector: How Digi International Inc. Compares
How Digi International Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Digi International Inc. Stock Overvalued? DGII Valuation Analysis 2026
Based on fundamental analysis, Digi International Inc. has mixed fundamental signals relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Digi International Inc. Balance Sheet: DGII Debt, Cash & Liquidity
DGII Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Digi International Inc.'s revenue has grown significantly by 44% over the 5-year period, indicating strong business expansion. The most recent EPS of $0.67 reflects profitable operations.
DGII Revenue Growth, EPS Growth & YoY Performance
DGII Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $103.9M | $10.1M | $0.27 |
| Q3 2025 | $105.2M | $9.7M | $0.26 |
| Q2 2025 | $104.5M | $940.0K | $0.03 |
| Q1 2025 | $103.9M | -$3.1M | $-0.08 |
| Q3 2024 | $105.2M | $6.7M | $0.18 |
| Q2 2024 | $107.7M | $940.0K | $0.03 |
| Q1 2024 | $106.1M | -$3.1M | $-0.08 |
| Q3 2023 | $103.5M | $4.1M | $0.12 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Digi International Inc. Dividends, Buybacks & Capital Allocation
DGII SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Digi International Inc. (CIK: 0000854775)
📋 Recent SEC Filings
| Date | Form | Document | Action |
|---|---|---|---|
| Mar 5, 2026 | 8-K | dgii-20260227.htm | View → |
| Feb 12, 2026 | 4 | xslF345X05/form4-02122026_100241.xml | View → |
| Feb 11, 2026 | 4 | xslF345X05/form4-02112026_110259.xml | View → |
| Feb 11, 2026 | 4 | xslF345X05/form4-02112026_110230.xml | View → |
| Feb 11, 2026 | 4 | xslF345X05/form4-02112026_110255.xml | View → |
❓ Frequently Asked Questions about DGII
What is the AI rating for DGII?
Digi International Inc. (DGII) has a Combined AI Rating of BUY from Claude (BUY) and ChatGPT (HOLD) with 75% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are DGII's key strengths?
Claude: Exceptional free cash flow generation (28.7% FCF margin, $35.2M annually) provides financial flexibility. Strong net income growth of 81.3% YoY with improving profitability demonstrates operational leverage. ChatGPT: Strong gross margin of 62.4% supports resilience and pricing power. Free cash flow generation is robust at $35.17M with a 28.7% FCF margin.
What are the risks of investing in DGII?
Claude: Flat revenue growth (0.0% YoY) indicates stagnant top-line expansion and potential market maturity. Low absolute profitability returns: 1.8% ROE and 1.3% ROA suggest capital is not being deployed efficiently despite strong cash generation. ChatGPT: Revenue was flat year over year, raising concern about underlying demand and growth durability. Interest coverage of 2.6x leaves limited cushion if profitability softens or rates remain elevated.
What is DGII's revenue and growth?
Digi International Inc. reported revenue of $122.5M.
Does DGII pay dividends?
Digi International Inc. does not currently pay dividends.
Where can I find DGII SEC filings?
Official SEC filings for Digi International Inc. (CIK: 0000854775) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is DGII's EPS?
Digi International Inc. has a diluted EPS of $0.31.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is DGII a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Digi International Inc. has a BUY rating with 75% confidence. The AI analysis suggests favorable fundamentals based on SEC filings. This is not investment advice.
Is DGII stock overvalued or undervalued?
Valuation metrics for DGII: ROE of 1.8% (sector avg: 22%), net margin of 9.6% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy DGII stock in 2026?
Our dual AI analysis gives Digi International Inc. a combined BUY rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is DGII's free cash flow?
Digi International Inc.'s operating cash flow is $35.6M, with capital expenditures of $457.0K. FCF margin is 28.7%.
How does DGII compare to other Technology stocks?
Vs Technology sector averages: Net margin 9.6% (avg: 18%), ROE 1.8% (avg: 22%), current ratio 1.24 (avg: 2.5).