Digi International Inc (DGII)

Liquidity ratios

Sep 30, 2023 Sep 30, 2022 Sep 30, 2021 Sep 30, 2020 Sep 30, 2019
Current ratio 1.93 1.72 4.18 2.78 4.33
Quick ratio 1.02 0.88 3.33 1.85 3.36
Cash ratio 0.37 0.36 2.59 0.88 2.09

The liquidity ratios of Digi International, Inc. indicate the company's ability to meet short-term obligations and cover immediate financial needs. The current ratio, which measures the company's ability to pay short-term liabilities with short-term assets, has fluctuated over the years but remained generally stable. The ratio has improved from 2019 to 2021 but decreased in 2022 before increasing again in 2023, indicating some variability in the company's short-term asset and liability management.

The quick ratio, which provides a more conservative measure of liquidity by excluding inventory from current assets, also demonstrates some variability. The ratio dipped in 2022 before recovering in 2023 but remains below the levels seen in 2019 and 2021. This suggests that the company may have a lower ability to cover its short-term obligations without relying on inventory in recent years.

The cash ratio, which indicates the proportion of current liabilities that could be covered by cash and cash equivalents, has also fluctuated. While it has generally decreased from 2019 to 2023, it remains at a level that indicates the company's ability to meet its short-term obligations using its cash resources.

Overall, the liquidity ratios suggest that Digi International, Inc. has maintained a relatively strong ability to meet its short-term obligations, although there has been some variability in the company's short-term asset and liability management in recent years. It is important for stakeholders to monitor these ratios closely to assess the company's ongoing liquidity position.


Additional liquidity measure

Sep 30, 2023 Sep 30, 2022 Sep 30, 2021 Sep 30, 2020 Sep 30, 2019
Cash conversion cycle days 154.41 134.15 106.58 140.81 131.18

The cash conversion cycle of Digi International, Inc. has exhibited some fluctuations over the past five years. In 2023, the cash conversion cycle increased to 156.69 days from 136.91 days in 2022. This indicates that, on average, it took the company 156.69 days to convert its investments in inventory and other resources into cash receipts from its sales to customers. The increase in the cash conversion cycle may suggest potential difficulties in managing working capital efficiency and liquidity.

Comparing this to 2021, where the cash conversion cycle was 108.37 days, there has been a notable increase. This could be a result of various factors such as changes in inventory management, payment terms, or collection periods from customers.

Although the cash conversion cycle in 2023 is higher than in 2022 and 2021, it is lower than the value of 142.98 days in 2020 and 132.31 days in 2019. This may indicate that the company has made progress in managing its working capital during 2023 compared to 2020 and 2019.

Overall, the trend in the cash conversion cycle suggests fluctuations in the efficiency of Digi International, Inc.'s working capital and liquidity management over the past five years, with 2023 showing an increase compared to the prior year.