This is proving to be the breakout year CEO Ron Konezny envisioned when he took over flagging Digi International in 2015.

The shares of Digi, which traded as low as $9 per share in 2015, traded last week around $18 per share, a 20-year high, on strong demand.

The shares of Digi have jumped by 20% since Nov. 15 alone, after the company announced record fiscal 2019 performance, a promising acquisition and a bright outlook for next year.

The company, which really started to gain traction in 2018, has achieved its highest price since the tech-bubble days of 1999. Only this time, the underlying performance is driving interest in the Hopkins-based wireless company that provides "internet of things" products and services.

"Our [2019] fiscal year was driven by key initiatives that the team delivered," Konezny said in a conference call with analysts and investors this month. "We doubled our revenue from products introduced within the past three years to nearly $40 million and we forecast that number will increase to $70 million in fiscal 2020. These key metrics show the alignment and effectiveness of our product management, sales and R & D teams within 'IoT' products & services.

"Both business segments contributed to a record fiscal 2019. Digi is well-positioned to build on that momentum in fiscal 2020."

Digi's earnings grew from $1.6 million in 2018 to $10 million in 2019, or 35 cents per share, on $215.3 million of revenue, up 7% year over year.

Investors also like the prospects for Digi's big acquisition this month, a $140 million cash-debt acquisition of an IT infrastructure company called Opengear. Its customers include Target, Best Buy and Netflix. Digi predicted Opengear will add to 2020 earnings.

Digi executives told analysts and investors that the company expects operating earnings to be in the range of $45 to $50 million next year, nearly double those of 2019. About $15 million of the increase is expected from Opengear.

This is the sixth acquisition by Digi under Konezny, 51, who said that past success in acquiring and integrating other companies was critical to winning Opengear. Opengear leans more toward commercial products, while Digi has been oriented toward industrial equipment.

Digi is deepening its penetration in six industries, including energy, medical, industrial and the municipal market.

Konezny has led a sometimes painful, job-shedding restructuring of Digi that has given way over the last couple of years to a successful strategy with more revenue and people.

The company makes and sells routers and other devices that connect equipment such as solar arrays and agricultural and factory equipment to the internet. It is getting faster growth from software and services that help monitor, adjust and maintain equipment that helps end-user companies monitor performance and replace parts before they expire.

"We maintain our belief Digi will post strong double-digit growth in its IoT Solutions business over the next several years with ramping up recurring revenue driving margins," analyst T. Michael Walkley of Canaccord Genuity, wrote investors after year-end results were disclosed. "With fiscal 2020 guidance approaching $50 million in adjusted EBITDA and the company generating strong free cash flow, we believe the [stock price-to-earnings] multiple should expand and the shares remain undervalued."

Walkley has raised his 12-month target price on Digi from $21 to $26 per share, the highest among analysts.

"We believe Digi has taken the right steps to right-size and refocus the business so it can see solid, consistent growth going forward," wrote Jaeson Schmidt of Lake Street Capital Markets, who has a target price of $20 per share on the stock."

This is a far cry from only three years ago, when Digi cut 10% of its workforce, as it transferred the last of its manufacturing to contract manufacturers in order to focus on new product introductions, acquisitions and integration of products and services, and increased sales. That's typical of fast-growing software firms expanding in market niches. And Konezny said investors probably haven't seen the last acquisition.

"We have increased our appetite and confidence in taking on bigger acquisitions," he said. "Opengear represents the largest acquisition … in the company's history. We are looking for more transformative opportunities that have got momentum and a great track record."

Digi, founded in 1985, has 500 employees and 15 global offices that serve 35,000 customers. It now boasts a market value of more than $500 million. Digi has an expanding footprint and acclaim for its technology and services, including a Minnesota Tekne award last week at the Minnesota High Tech Association annual awards.

Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. He can be contacted at