Digi International Inc (DGII)

Financial leverage ratio

		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	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Total assets	US$ in thousands	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	398,698	385,246	383,535
Total stockholders’ equity	US$ in thousands	542,075	540,488	531,583	520,179	509,928	501,513	486,922	480,504	474,032	472,517	465,471	459,152	377,642	371,500	363,305	358,363	356,315	348,978	345,076	340,838
Financial leverage ratio		1.53	1.55	1.58	1.63	1.68	1.70	1.77	1.81	1.83	1.31	1.32	1.32	1.40	1.42	1.45	1.55	1.57	1.14	1.12	1.13

December 31, 2023 calculation

Financial leverage ratio = Total assets ÷ Total stockholders’ equity
= $828,662K ÷ $542,075K
= 1.53

Digi International, Inc.'s financial leverage ratio has been trending upwards over the past quarters, indicating an increase in the company's reliance on debt to finance its operations and growth. The ratio has moved from 1.53 in Q1 2024 to 1.81 in Q2 2022, highlighting a steady rise in leverage over this period.

A financial leverage ratio above 1 suggests that the company has more debt than equity in its capital structure. While some level of debt can be beneficial for leveraging returns, a high leverage ratio can also signal higher financial risk and vulnerability to economic downturns or interest rate fluctuations.

The consistent increase in Digi International's financial leverage ratio may raise concerns about its ability to manage debt levels and meet repayment obligations in the future. Investors and creditors may closely monitor this trend to assess the company's financial health and stability. Management should carefully evaluate the impact of increasing leverage on the company's overall risk profile and strategic objectives.