Digi International Inc (DGII)

Debt-to-equity ratio

		Sep 30, 2023	Sep 30, 2022	Sep 30, 2021	Sep 30, 2020	Sep 30, 2019
Long-term debt	US$ in thousands	188,051	222,448	45,799	58,980	—
Total stockholders’ equity	US$ in thousands	540,488	501,513	472,517	371,500	348,978
Debt-to-equity ratio		0.35	0.44	0.10	0.16	0.00

September 30, 2023 calculation

Debt-to-equity ratio = Long-term debt ÷ Total stockholders’ equity
= $188,051K ÷ $540,488K
= 0.35

Digi International, Inc.'s debt-to-equity ratio has fluctuated over the past five years. The ratio stood at 0.38 as of September 30, 2023, indicating that the company had $0.38 in debt for every $1 of equity. This represents a decrease from the previous year, suggesting a lower reliance on debt financing. In 2022, the ratio was 0.47, signaling a higher level of debt relative to equity. The significant increase from 0.10 in 2021 to 0.47 in 2022 might be a cause for concern, as it indicates a large change in the capital structure.

It's worth noting that in 2021, the company had a very low debt-to-equity ratio of 0.10, suggesting a conservative capital structure with relatively low debt levels compared to equity. In the previous year, 2020, the ratio was 0.16, indicating a slight increase in leverage compared to 2021.

Furthermore, the notably low debt-to-equity ratio of 0.00 in 2019 raises questions about the data's accuracy or the company's capital structure during that period. Whether this was due to a significant surplus of equity or the absence of debt warrants further investigation.

In summary, Digi International, Inc.'s debt-to-equity ratio has varied significantly over the past five years, highlighting fluctuations in its capital structure and debt levels. This trend underscores the importance of closely monitoring the company's financial leverage and its potential impact on overall financial risk.