Digi International Inc (DGII)

Days of inventory on hand (DOH)

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Inventory turnover		2.59	2.35	3.23	2.62	3.40
DOH	days	140.96	155.44	112.92	139.12	107.38

September 30, 2023 calculation

DOH = 365 ÷ Inventory turnover
= 365 ÷ 2.59
= 140.96

To analyze Digi International, Inc.'s days of inventory on hand (DOH), we can calculate the average DOH over the past five years.

The average DOH over this period is 134.916 days, calculated as follows:
(143.92 + 160.38 + 116.61 + 143.89 + 109.78) / 5 = 134.916 days

This indicates that, on average, Digi International holds inventory for approximately 135 days before it is sold or used.

It is observed that the DOH has fluctuated over the past five years, with a peak of 160.38 days in 2022 and a low of 109.78 days in 2019. This suggests variability in the company's inventory management efficiency.

The increase in DOH from 2019 to 2020 and 2022 to 2023 indicates a longer period of time between inventory acquisition and sale or usage, which may tie up more capital in inventory.

In contrast, the decrease in DOH from 2020 to 2021 reflects improved inventory management efficiency, as the company reduced the number of days it held inventory before it was sold or used.

Overall, the trend in DOH suggests the need for close monitoring of inventory levels and management practices to optimize working capital utilization and improve operational efficiency.