Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher, with the expectation that established trends will continue [1] Company Overview: Digi International (DGII) - Digi International currently holds a Momentum Style Score of B, indicating a favorable momentum characteristic [2] - The company has a Zacks Rank of 2 (Buy), suggesting strong potential for outperformance in the market [3] Performance Metrics - Over the past week, DGII shares have increased by 7.79%, while the Zacks Computer - Networking industry remained flat [5] - In a longer timeframe, DGII's monthly price change is 30.66%, significantly outperforming the industry's 2.13% [5] - Over the last quarter, DGII shares rose by 29.48%, and over the past year, they increased by 38.72%, compared to the S&P 500's gains of 5.71% and 15.31%, respectively [6] Trading Volume - The average 20-day trading volume for DGII is 294,800 shares, which serves as a bullish indicator when combined with rising stock prices [7] Earnings Outlook - In the past two months, three earnings estimates for DGII have been revised upwards, while none have been lowered, leading to an increase in the consensus estimate from $2.20 to $2.38 [9] - For the next fiscal year, one estimate has moved upwards with no downward revisions [9] Conclusion - Given the positive performance metrics and earnings outlook, DGII is positioned as a 2 (Buy) stock with a Momentum Score of B, making it a strong candidate for near-term investment [11]

Company Performance - Digi International reported quarterly earnings of $0.51 per share, exceeding the Zacks Consensus Estimate of $0.49 per share, and showing an increase from $0.49 per share a year ago, representing an earnings surprise of 4.08% [1] - The company posted revenues of $104.5 million for the quarter ended March 2025, which was below the Zacks Consensus Estimate by 0.13% and a decrease from $107.7 million in the same quarter last year [2] - Over the last four quarters, Digi International has surpassed consensus EPS estimates two times and topped consensus revenue estimates only once [2] Stock Outlook - The stock has underperformed the market, losing about 7.4% since the beginning of the year compared to the S&P 500's decline of 4.7% [3] - The current consensus EPS estimate for the upcoming quarter is $0.50 on revenues of $105.76 million, and for the current fiscal year, it is $1.99 on revenues of $422.12 million [7] - The estimate revisions trend for Digi International is currently unfavorable, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Computer - Networking industry, to which Digi International belongs, is currently ranked in the bottom 37% of over 250 Zacks industries, suggesting that the outlook for the industry can significantly impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]