Discounted Cash Flow (DCF) Analysis Levered

Digi International Inc. (DGII)

$25.7

-1.20 (-4.46%)

All numbers are in Millions, Currency in USD

Stock DCF: 15.45 | 25.7 | overvalue

Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	228.37	254.20	279.27	308.63	388.22	444.01	507.81	580.78	664.24	759.68
Revenue (%)
Operating Cash Flow	-2.78	28.96	34.48	57.72	37.74	45.24	51.74	59.18	67.68	77.41
Operating Cash Flow (%)
Capital Expenditure	-1.84	-9.34	-0.90	-2.26	-1.97	-5.36	-6.13	-7.02	-8.02	-9.18
Capital Expenditure (%)
Free Cash Flow	-4.62	19.63	33.58	55.47	35.77	39.88	45.61	52.16	59.66	68.23

Weighted Average Cost Of Capital

Share price	$ 25.7
Beta	1.281
Diluted Shares Outstanding	35.99
Cost of Debt
Tax Rate	-4.05
After-tax Cost of Debt	126.91%
Risk-Free Rate
Market Risk Premium
Cost of Equity	10.849
Total Debt	15.52
Total Equity	925.07
Total Capital	940.59
Debt Weighting	1.65
Equity Weighting	98.35
Wacc

Build Up Free Cash Flow

Year A/P	2018 Actual	2019 Actual	2020 Actual	2021 Actual	2022 Actual	2023 Projected	2024 Projected	2025 Projected	2026 Projected	2027 Projected
Revenue	228.37	254.20	279.27	308.63	388.22	444.01	507.81	580.78	664.24	759.68
Operating Cash Flow	-2.78	28.96	34.48	57.72	37.74	45.24	51.74	59.18	67.68	77.41
Capital Expenditure	-1.84	-9.34	-0.90	-2.26	-1.97	-5.36	-6.13	-7.02	-8.02	-9.18
Free Cash Flow	-4.62	19.63	33.58	55.47	35.77	39.88	45.61	52.16	59.66	68.23
WACC
PV LFCF						35.37	35.87	36.38	36.90	37.43
SUM PV LFCF										181.95

Terminal Value

Growth in perpetuity method:
Long-term growth rate
WACC (%)	12.76
Free cash flow (t + 1)	69.59
Terminal Value	646.79
Present Value of Terminal Value	354.80

Intrinsic Value

Enterprise Value	536.75
Net Debt	-19.38
Equity Value	556.13
Shares Outstanding	35.99
Equity Value Per Share	15.45