Boenning & Scattergood Announces Investment Opinion: Boenning & Scattergood Initiates Coverage of Digi International Inc. with a Market Outperform Rating and $17 Target.

WEST CONSHOHOCKEN, Pa. -- Boenning & Scattergood, Inc. initiates research coverage of Digi International Inc. (NASDAQ:DGII) with a Market Outperform rating and a 12-month price target of $17. Digi International develops commercial-grade device networking products that allow businesses to more efficiently connect and securely manage electronic devices via the Internet or other network connection.

Boenning & Scattergood believes that Digi's brand reputation and ability to generate strong cash flows in combination with its recent acquisition strategy should allow the company to take advantage of the expected growth in machine-to-machine communications. The firm believes the stock is undervalued for the following reasons:

* The number of devices connected to the Internet is predicted to reach 15 billion by 2010, 95% of which will be something other than a computer.

* The company's acquisition of MaxStream offers significant cross-sell and up-sell opportunities and allows Digi to capitalize on the rapidly growing ZigBee market.

* The current valuation does not reflect the company's ability to generate above average operating margins and the potential to accelerate revenue growth from the uptake in device connectivity.

Boenning & Scattergood's equity research department follows small and mid-sized companies in the business services, financial services, technology and industrial services sectors, providing in-depth industry knowledge combined with a mid-Atlantic focus. For a full text of this report or any other report issued by Boenning & Scattergood, institutional investors should contact our sales desk at 610-832-5315.

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