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Badger Meter Rallies 17% in Three Months: How to Play the Stock?
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Badger Meter Inc’s (BMI - Free Report) shares have been performing well on the trading front, with a gain of 16.5% in the past three months. BMI stock gained 0.9% in the last trading session and closed at $219.90. It also reached a new 52-week high of $220.77 in the last trading session.
The stock has outperformed its sub-industry and the S&P 500 composite’s growth of 3.2% and 2.6%, respectively.
Three-month Price Performance
Image Source: Zacks Investment Research
BMI stock’s good run on the trading front can be attributed to its sustained strong financial performance. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 12.9%.
As BMI stock reached a new 52-week high, investors are now most likely contemplating whether to stay invested or cash out. Let’s dive into BMI’s prospects and determine the best course of action for your portfolio.
Will BMI Stock Continue Its Upward Trajectory?
Headquartered in Milwaukee, WI, Badger Meter is a leading water solutions provider, including flow measurement, quality and other system parameters.
Demand for digital smart water solutions has been increasing attributed to secular challenges in the water industry. This is driving strong adoption of BMI’s differentiated smart water solutions, including higher uptake of meters (both mechanical and E-Series Ultrasonic), ORION Cellular endpoints and associated BEACON Software-as-a-Service (SaaS) revenue. Stable demand across water-focused end markets has been driving Flow Instrumentation sales.
In the last reported quarter, sales jumped 23% year over year to $216.7 million, representing the first-ever quarter with sales of more than $200 million. Apart from stable demand, smooth operational execution is another tailwind.
Image Source: Zacks Investment Research
Badger Meter is continuously prioritizing and enhancing its presence in selected regional markets outside the United States that offer healthy growth potential. The company is likely to benefit by expanding its market share in water-related applications.
BMI recently introduced the BlueEdge framework to simplify its comprehensive suite of scalable water solutions. BlueEdge platform is an umbrella term that combines water technology, software and services to enhance customer experience with efficient water management. This can be customized to address applications for the entire water cycle and will also serve as a ‘strategic lens’ for the company to assess growth investments.
Various favorable macroeconomic drivers for the water industry growth, along with a strong opportunity funnel, bid pipeline, order book rates and increasing SaaS revenues, bode well for the long term. This is likely to drive the financial performance and propel the stock trajectory further.
Nonetheless, management expects to witness tougher year-over-year comparisons as the year progresses and higher expenses owing to incremental growth investments. An uncertain global macroeconomic backdrop, forex volatility and intensified competition are added headwinds.
Estimate Revision Activity for BMI
In the past 60 days, analysts have increased their earnings estimates for both the current quarter and the next by 1%. The earnings estimate for the current and the next year has also been revised upward by 0.7% and 1.3%, respectively.
Image Source: Zacks Investment Research
BMI’s Expensive Valuation
BMI stock is trading at a premium with a forward 12-month Price/earnings ratio of 48.67X compared with the industry’s 19.62X.
Image Source: Zacks Investment Research
How to Play the BMI Stock?
BMI carries a Zacks Rank #3 (Hold) at present.
A nuanced approach is needed while dealing with BMI. The stock has a solid growth opportunity driven by demand for its solutions amid secular changes in the water vertical. However, the expensive valuation and expectations of tougher year-over-year comparisons warrant caution. Volatile global macroeconomic conditions and intensified competition remain additional concerns. Consequently, it might not be a prudent investment decision to bet on the stock at the moment. However, long-term stakeholders and investors already owning the stock can stay put.
The Zacks Consensus Estimate for STX’s fiscal 2025 EPS is pegged at $7.41, unchanged in the past 30 days. STX’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in the remaining quarter, with the average surprise being 80.9%. The stock has surged 65.9% in the past year.
The Zacks Consensus Estimate for NTAP’s fiscal 2025 earnings is pegged at $7.08, unchanged in the past seven days. NTAP’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 8.6%. Its shares have gained 64.3% in the past year.
The Zacks Consensus Estimate for BlackBerry’s fiscal 2025 EPS is pegged at a loss of 2 cents, improved from a loss of 5 cents in the past seven days. BB’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 131.3%. Its shares have declined 44.1% in the past year.
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Badger Meter Rallies 17% in Three Months: How to Play the Stock?
Badger Meter Inc’s (BMI - Free Report) shares have been performing well on the trading front, with a gain of 16.5% in the past three months. BMI stock gained 0.9% in the last trading session and closed at $219.90. It also reached a new 52-week high of $220.77 in the last trading session.
The stock has outperformed its sub-industry and the S&P 500 composite’s growth of 3.2% and 2.6%, respectively.
Three-month Price Performance
Image Source: Zacks Investment Research
BMI stock’s good run on the trading front can be attributed to its sustained strong financial performance. Its earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 12.9%.
As BMI stock reached a new 52-week high, investors are now most likely contemplating whether to stay invested or cash out. Let’s dive into BMI’s prospects and determine the best course of action for your portfolio.
Will BMI Stock Continue Its Upward Trajectory?
Headquartered in Milwaukee, WI, Badger Meter is a leading water solutions provider, including flow measurement, quality and other system parameters.
Demand for digital smart water solutions has been increasing attributed to secular challenges in the water industry. This is driving strong adoption of BMI’s differentiated smart water solutions, including higher uptake of meters (both mechanical and E-Series Ultrasonic), ORION Cellular endpoints and associated BEACON Software-as-a-Service (SaaS) revenue. Stable demand across water-focused end markets has been driving Flow Instrumentation sales.
In the last reported quarter, sales jumped 23% year over year to $216.7 million, representing the first-ever quarter with sales of more than $200 million. Apart from stable demand, smooth operational execution is another tailwind.
Image Source: Zacks Investment Research
Badger Meter is continuously prioritizing and enhancing its presence in selected regional markets outside the United States that offer healthy growth potential. The company is likely to benefit by expanding its market share in water-related applications.
BMI recently introduced the BlueEdge framework to simplify its comprehensive suite of scalable water solutions. BlueEdge platform is an umbrella term that combines water technology, software and services to enhance customer experience with efficient water management. This can be customized to address applications for the entire water cycle and will also serve as a ‘strategic lens’ for the company to assess growth investments.
Various favorable macroeconomic drivers for the water industry growth, along with a strong opportunity funnel, bid pipeline, order book rates and increasing SaaS revenues, bode well for the long term. This is likely to drive the financial performance and propel the stock trajectory further.
Nonetheless, management expects to witness tougher year-over-year comparisons as the year progresses and higher expenses owing to incremental growth investments. An uncertain global macroeconomic backdrop, forex volatility and intensified competition are added headwinds.
Estimate Revision Activity for BMI
In the past 60 days, analysts have increased their earnings estimates for both the current quarter and the next by 1%. The earnings estimate for the current and the next year has also been revised upward by 0.7% and 1.3%, respectively.
Image Source: Zacks Investment Research
BMI’s Expensive Valuation
BMI stock is trading at a premium with a forward 12-month Price/earnings ratio of 48.67X compared with the industry’s 19.62X.
Image Source: Zacks Investment Research
How to Play the BMI Stock?
BMI carries a Zacks Rank #3 (Hold) at present.
A nuanced approach is needed while dealing with BMI. The stock has a solid growth opportunity driven by demand for its solutions amid secular changes in the water vertical. However, the expensive valuation and expectations of tougher year-over-year comparisons warrant caution. Volatile global macroeconomic conditions and intensified competition remain additional concerns. Consequently, it might not be a prudent investment decision to bet on the stock at the moment. However, long-term stakeholders and investors already owning the stock can stay put.
Stocks to Consider
Some better-ranked stocks worth consideration in the broader technology space are Seagate Technology Holdings plc (STX - Free Report) , NetApp (NTAP - Free Report) and BlackBerry (BB - Free Report) . All stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for STX’s fiscal 2025 EPS is pegged at $7.41, unchanged in the past 30 days. STX’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters while missing in the remaining quarter, with the average surprise being 80.9%. The stock has surged 65.9% in the past year.
The Zacks Consensus Estimate for NTAP’s fiscal 2025 earnings is pegged at $7.08, unchanged in the past seven days. NTAP’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 8.6%. Its shares have gained 64.3% in the past year.
The Zacks Consensus Estimate for BlackBerry’s fiscal 2025 EPS is pegged at a loss of 2 cents, improved from a loss of 5 cents in the past seven days. BB’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 131.3%. Its shares have declined 44.1% in the past year.