Is BMI a good stock to buy? We came across a bullish thesis on Badger Meter, Inc. on Quality At A Fair Price’s Substack. In this article, we will summarize the bulls’ thesis on BMI. Badger Meter, Inc.’s share was trading at $130.34 as of June 8th. BMI’s trailing and forward P/E were 28.63 and 27.10 respectively according to Yahoo Finance.
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Badger Meter Inc. is a leading provider of water management solutions focused on flow measurement technologies, smart metering systems, and advanced analytics for municipal and industrial customers worldwide. The company has steadily positioned itself at the center of the global push toward smarter infrastructure and water conservation, benefiting from long-term secular trends tied to aging utility systems, digital transformation, and increasing demand for efficient resource management.
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Despite these strong fundamentals, the market has recently created a compelling valuation disconnect. Badger Meter was previously trading at an estimated 16.5% discount, but that discount has now widened to more than 40%, presenting what appears to be a highly attractive entry point for long-term investors. The company’s 5-year average dividend yield stands at just 0.77%, while its forward yield has climbed to 1.36%, implying meaningful undervaluation relative to its historical norms.
The investment case becomes even more compelling when combined with Badger Meter’s exceptional dividend growth profile. The company has delivered more than 20 consecutive years of dividend increases, demonstrating both resilience and disciplined capital allocation across multiple economic cycles.
Its dividend growth metrics remain remarkably strong, with 3-, 5-, and 10-year CAGR figures consistently hovering around the 15% range, highlighting management’s confidence in future cash flow generation. With strong exposure to essential infrastructure spending, recurring demand from utilities, expanding smart water adoption, and a balance sheet capable of supporting continued growth, Badger Meter appears well positioned for both sustained earnings expansion and a significant rerating once valuation normalizes.
Previously, we covered a bullish thesis on Badger Meter, Inc. (BMI) by Durable Value Creators in November 2024, which highlighted the smart water ecosystem, AMI-driven digitization, and software-led recurring revenue growth. BMI’s stock price has depreciated by approximately 40.54% since our coverage. Quality At A Fair Price shares a similar view but emphasizes valuation discount and dividend growth profile.
