Craig-Hallum Downgrades Digi International (DGII) to Hold

Craig-Hallum analyst Anthony Stoss downgraded Digi International (NASDAQ: DGII) from Buy to Hold with a price target of $32.00 (from $28.00).

The analyst commented: "With the stock trading up nearly 8% in the aftermarket, we are stepping to the sidelines on DGII as macro uncertainty and customer caution continues to impact DGII’s forward outlook. More specifically, DGII expects FY2025 revenue and EBITDA to be flat with 2024. Management stated that customers remain cautious given the overall economy. We are conservative in our FY25 estimates given the uncertainty around the macro environment. We note ARR growth continues to be solid and GMs remain high but we believe the worst is not yet behind for DGII. ARR growth is expected to continue for FY25, with DGII calling for 10% Y/Y growth. We are cautious on shares as the stock has run up recently and await a better entry point. We believe the company’s five-year, $200M in adj. EBITDA and ARR, financial targets should provide insight to long term growth but we are increasingly worried about the health of the economy and impact to DGII."

For an analyst ratings summary and ratings history on Digi International click here. For more ratings news on Digi International click here.

Shares of Digi International closed at $31.97 yesterday.

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