Digi International Inc (DGII)

Operating return on assets (Operating ROA)

		Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019
Operating income (ttm)	US$ in thousands	48,089	46,673	46,241	50,265	50,095	53,497	50,995	46,384	38,220	24,623	18,667	14,473	10,528	12,463	11,300	11,654	11,317	8,204	6,970	4,031
Total assets	US$ in thousands	815,075	820,426	825,300	828,662	835,531	840,060	847,748	854,610	853,895	863,639	869,530	866,230	619,531	613,051	607,503	528,788	528,682	526,869	554,752	560,904
Operating ROA		5.90%	5.69%	5.60%	6.07%	6.00%	6.37%	6.02%	5.43%	4.48%	2.85%	2.15%	1.67%	1.70%	2.03%	1.86%	2.20%	2.14%	1.56%	1.26%	0.72%

September 30, 2024 calculation

Operating ROA = Operating income (ttm) ÷ Total assets
= $48,089K ÷ $815,075K
= 5.90%

Operating return on assets (operating ROA) is a key financial ratio that indicates how efficiently a company generates operating income from its assets. A higher operating ROA suggests better operational efficiency and profitability.

Analyzing the operating ROA trend of Digi International Inc over the past 20 quarters reveals some fluctuations. The operating ROA has generally shown an upward trajectory from 0.72% in December 2019 to 5.90% in September 2024. This demonstrates an improvement in the company's ability to generate operating income relative to its assets over the period.

However, there are periods of variability in the operating ROA, indicating potential challenges in maintaining consistent profitability relative to asset utilization. Notably, the operating ROA experienced a dip in the first quarters of both 2022 and 2023, which may suggest operational challenges or inefficiencies during those periods.

Overall, the trend of increasing operating ROA from 2019 to 2024 is a positive sign of enhanced operational efficiency and profitability for Digi International Inc. Further analysis of the underlying factors driving these fluctuations in operating ROA would provide more insights into the company's operational performance and potential areas for improvement.