What Do Digi International’s Risk Factors Tell Investors?


Digi International (DGII) is a provider of Internet of Things (IoT) products and services for businesses and mission-critical applications.

Let us take a look at the company’s financials and understand what has changed in its key risk factors that investors should know.

Q4 Financial Results

Sales increased 8.1% year-over-year to $79.1 million. Meanwhile, the company reported earnings of $0.25 per share, down 21.9% on a year-over-year basis.

Digi Risk Factors

According to the new Tipranks’ Risk Factors tool, Digi’s main risk category is Finance & Corporate, which accounts for 21% of the total 39 risks identified. The next two major DGII risks fall under the Ability to Sell and Tech & Innovation categories, which stand at 21% and 18%, respectively.

The company has added one risk under the Production category.

Digi highlights a variety of factors contributing to supply chain disruptions, including personnel shortages, container ship backlogs, physical container shortages, and material and component shortages. Furthermore, the policy steps taken by the Chinese government may exacerbate supply chain problems.

As a result, the firm is experiencing a scarcity of components and is unable to meet customer orders on time. Despite the company’s attempts to limit the impact of such supply chain disruptions, they may have a significant impact on the company’s financial operations in the future.

On a brighter note, the overall sector average for the Finance & Corporate risk factor is 40.2%, higher than the average risks in that category for Digi, which is 20.5%.

Wall Street’s Take

Turning to Wall Street, the stock has a Strong Buy consensus rating based on 3 unanimous Buys. The average DGII price target of $29.83 implies 24.7% upside potential to current levels.

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