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1. Company Snapshot

1.a. Company Description

Badger Meter, Inc.manufactures and markets flow measurement, quality, control, and communication solutions in the United States, Asia, Canada, Europe, Mexico, the Middle East, and internationally.It offers mechanical or static water meters, and related radio and software technologies and services to municipal water utilities.


The company also provides flow instrumentation products, including meters, valves, and other sensing instruments to measure and control fluids going through a pipe or pipeline, including water, air, steam, oil, and other liquids and gases to original equipment manufacturers as the primary flow measurement device within a product or system, as well as through manufacturers' representatives.Its flow instrumentation products are used in water/wastewater, heating, ventilating and air conditioning, and corporate sustainability markets.In addition, the company offers ORION Migratable for automatic meter reading; ORION (SE) for traditional fixed network applications; and ORION Cellular for infrastructure-free fixed network meter reading solution, as well as BEACON advanced metering analytics, a secure cloud-hosted software suite that establishes alerts for specific conditions and allows consumer engagement tools that permit end water customers to view and manage their water usage activity.


It also serves water utilities, industrial, and other industries.The company sells its products directly, as well as through resellers and representatives.Badger Meter, Inc.


was incorporated in 1905 and is headquartered in Milwaukee, Wisconsin.

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1.b. Last Insights on BMI

Badger Meter's recent performance was negatively impacted by Q2 2025 earnings comments, causing a sharp stock decline. However, underlying business metrics remain positive, with strong revenue growth, expanding profit margins, and robust return on invested capital. The company's Q3 earnings surpassed estimates, with quarterly earnings of $1.19 per share, beating the Zacks Consensus Estimate. A recent rating upgrade by an analyst firm rates the company a buy, citing strong visibility to further margin expansion. Additionally, the company reported total sales of $235.7 million, 13% higher than the prior year.

1.c. Company Highlights

2. Badger Meter's Q3 2025 Earnings: Strong Performance and Growth Prospects

Badger Meter reported a strong Q3 2025, with total sales reaching $236 million, a 13% year-over-year increase, driven by an 8% base sales growth. Operating earnings rose 13% to $46.1 million, with operating margins expanding 10 basis points to 19.6%. The company's gross margins also improved, increasing 50 basis points to 40.7% from 40.2% in the prior year quarter. Consolidated EPS came in at $1.19, beating estimates of $1.11, representing a 10% year-over-year increase.

Publication Date: Oct -21

📋 Highlights
  • Sales Growth:: Total sales rose 13% YoY to $236M, with 8% base sales growth and 14% growth in utility water product lines (excluding SmartCover).
  • Operating Performance:: Operating earnings hit $46.1M (+13% YoY), while margins improved 10 bps to 19.6% and gross margins expanded 50 bps to 40.7%.
  • Free Cash Flow:: Record FCF of $48.2M, up $6M YoY, and gross margin guidance raised to 39-42% due to mix improvements and pricing.
  • Strategic Growth Drivers:: SmartCover grew 25% YoY, and software revenue surged 28% CAGR, driven by Orion cellular AMI and network-as-a-service adoption.
  • Long-Term Outlook:: Maintains high-single-digit organic sales growth target, supported by ultrasonic meter demand, water quality traction, and price realization strategies.

Revenue Growth and Segment Performance

The utility water product line saw a 14% year-over-year sales increase, or 8% excluding SmartCover, which grew approximately 25% in the quarter. The company's BlueEdge suite, including SmartCover, is expected to continue growing at an outsized level. Software sales were also a driver of growth, with a 28% CAGR in software revenue due to the success of selling Orion cellular AMI and network as a service.

Margin Expansion and Pricing Power

Badger Meter raised its gross margin range from 38-40% to 39-42%, citing structural mix improvement and price increases that partially mitigated tariff-related cost pressures. The company implemented targeted product-specific price increases in Q2, which will continue on an ongoing basis for PO-to-PO business and annual contract renewals, allowing for price realization to catch up with cost effects.

Valuation and Growth Prospects

With a P/E Ratio of 37.6 and an expected revenue growth rate of 8.5% next year, the market is pricing in a certain level of growth for Badger Meter. The company's ROE of 20.36% and ROIC of 16.23% indicate a strong ability to generate returns on equity and invested capital. The current valuation multiples suggest that the market is expecting continued growth and profitability from the company. Analysts' estimates and the company's guidance suggest that Badger Meter is on track to deliver on its long-term strategy of compounding value for customers and shareholders.

Capital Allocation and Future Outlook

Badger Meter's priorities remain investing in organic growth, increasing dividends, and M&A. The company has a strong process for understanding and addressing tariff impacts and feels confident in its ability to manage costs. With a strong backlog and customer conversations, the company remains confident in its high single-digit through-the-cycle growth target, despite some uncertainty around tariffs and other factors.

3. NewsRoom

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Badger Meter (BMI) Upgraded to Buy: Here's What You Should Know

Dec -02

Source: zacks.com

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Top 15 High-Growth Dividend Stocks For December 2025

Dec -02

Source: seekingalpha.com

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Associated Banc Corp Purchases Shares of 1,000 Badger Meter, Inc. $BMI

Nov -27

Source: defenseworld.net

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XXEC Investment Advisors Sells 17,000 Badger Meter Shares Worth $4.4 Million

Nov -26

Source: fool.com

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Badger Meter Declares Regular Quarterly Dividend and Expands Share Repurchase Authorization

Nov -07

Source: businesswire.com

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Is the Options Market Predicting a Spike in Badger Meter Stock?

Nov -07

Source: zacks.com

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Top 15 High-Growth Dividend Stocks For November 2025

Nov -02

Source: seekingalpha.com

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Badger Meter, Inc. $BMI Shares Sold by Asset Management One Co. Ltd.

Nov -01

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (7.00%)

6. Segments

Flow Measurement, Control, Quality and Communication Solutions

Expected Growth: 7.0%

Badger Meter's 7.0% growth driven by increasing demand for accurate flow measurement, control, and quality solutions in water and gas utilities, industrial processes, and smart city infrastructure. Growing adoption of IoT and digital technologies also fuels growth, as customers seek real-time data and analytics to optimize operations and reduce waste.

7. Detailed Products

Water Meters

Accurate and reliable water meters for residential, commercial, and industrial applications

Gas Meters

High-accuracy gas meters for residential, commercial, and industrial applications

Flow Meters

Accurate and reliable flow meters for measuring liquid flow rates in various industries

Orion Metering Systems

Advanced metering systems for water, gas, and electric utilities

BEACON Advanced Metering Analytics

Cloud-based analytics platform for water, gas, and electric utilities

E-Series Ultrasonic Meters

High-accuracy ultrasonic meters for water and gas measurement

Recordall Meters

Mechanical and electronic meters for water and gas measurement

8. Badger Meter, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Badger Meter, Inc. faces moderate threat from substitutes due to the presence of alternative technologies and products in the water metering industry.

Bargaining Power Of Customers

Badger Meter, Inc. has a diverse customer base, which reduces the bargaining power of individual customers, giving the company an upper hand in negotiations.

Bargaining Power Of Suppliers

Badger Meter, Inc. relies on a few key suppliers for components and materials, giving them some bargaining power, but the company's size and reputation help mitigate this risk.

Threat Of New Entrants

The water metering industry has high barriers to entry, including significant capital requirements and regulatory hurdles, making it difficult for new entrants to challenge Badger Meter, Inc.'s market position.

Intensity Of Rivalry

The water metering industry is highly competitive, with several established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 1.10%
Debt Cost 3.95%
Equity Weight 98.90%
Equity Cost 8.03%
WACC 7.98%
Leverage 1.11%

11. Quality Control: Badger Meter, Inc. passed 7 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Teledyne Technologies

A-Score: 5.7/10

Value: 2.8

Growth: 6.3

Quality: 6.9

Yield: 0.0

Momentum: 8.0

Volatility: 10.0

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Vontier

A-Score: 5.0/10

Value: 4.9

Growth: 3.8

Quality: 6.3

Yield: 0.0

Momentum: 7.5

Volatility: 7.3

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Jabil

A-Score: 4.9/10

Value: 3.5

Growth: 6.7

Quality: 4.6

Yield: 0.0

Momentum: 9.5

Volatility: 5.3

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OSI Systems

A-Score: 4.8/10

Value: 2.6

Growth: 5.9

Quality: 6.1

Yield: 0.0

Momentum: 9.0

Volatility: 5.3

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Badger Meter

A-Score: 4.5/10

Value: 1.4

Growth: 8.0

Quality: 7.6

Yield: 1.0

Momentum: 2.0

Volatility: 6.7

1-Year Total Return ->

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Plexus

A-Score: 4.4/10

Value: 3.6

Growth: 4.7

Quality: 5.6

Yield: 0.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

180.14$

Current Price

180.14$

Potential

-0.00%

Expected Cash-Flows