Value
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 3.3 |
| P/S | 6.6 |
| EV/EBITDA | 0.0 |
| Fwd P/E | 3.4 |
| PEG | 3.4 |
| Analyst target | 4.0 |
- ▸Forward P/E: 32.8x
- ▸PEG: 3.53
BMI · Why this verdict
Why Badger Meter (BMI) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.0/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Badger Meter is a high-quality, financially sound business (quality 7.2, Piotroski 9/9), but at $148.38 the stock already sits above the $144.20 analyst target, leaving little upside against a 15% downside.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Utility Water accounts for 89.0% of revenue and key inputs come from single suppliers, so results depend on one end market and a narrow supply chain. Bear case | Quarterly revenue stays at or above the recent $222M-$236M range, showing steady utility demand. | →Stable |
| CounterA municipal budget slowdown or a supplier disruption for brass castings, resins or electronics would hit the whole business at once. | ||
Operating quality is strong, with a Piotroski F-Score of 9/9 and an overall quality score of 7.2 that should hold through the next year. Quality breakdown | Quality score stays at or above 7.0 and the Piotroski F-Score remains 8 or higher over ~12 months. | →Stable |
| CounterQuality scores are backward-looking; flat revenue (about $236M versus $236M a year ago) suggests a mature business whose margins could erode. | ||
Valuation is rich at a 29.8x forward P/E and a PEG of 3.44, and the price is 2.8% above the $144.20 analyst target, so there is little upside left. Valuation breakdown | Analyst targets get revised above the current price, or earnings growth catches up so forward P/E compresses toward the mid-20s. | ↓Deteriorating |
| CounterPremium multiples for a dividend-paying, high-quality compounder can persist, and analyst targets often lag price. | ||
Earnings have recovered from an April miss of -24.0% to consecutive beats (+0.72% and +1.81%), with estimates trending up. Last 4 quarters | EPS beats continue over the next 4 quarters and the average surprise turns positive from -5.7%. | ↓Deteriorating |
| CounterBeats are slim (about 1-2%), the four-quarter average surprise is still -5.7%, and the April miss shows volatility. | ||
Momentum is middling at 5.3/10 with falling on-balance volume, while 22% short interest creates two-way risk. Momentum breakdown | Momentum score holds above 4.5 and volume confirms the trend over the next several quarters. | ↑Improving |
| CounterFalling OBV signals distribution, and with the price above the analyst target, a crowded short position could add to downside if sentiment turns. | ||
Utility Water accounts for 89.0% of revenue and key inputs come from single suppliers, so results depend on one end market and a narrow supply chain.
→StableBear case
- Expectation
- Quarterly revenue stays at or above the recent $222M-$236M range, showing steady utility demand.
CounterA municipal budget slowdown or a supplier disruption for brass castings, resins or electronics would hit the whole business at once.
Operating quality is strong, with a Piotroski F-Score of 9/9 and an overall quality score of 7.2 that should hold through the next year.
→StableQuality breakdown
- Expectation
- Quality score stays at or above 7.0 and the Piotroski F-Score remains 8 or higher over ~12 months.
CounterQuality scores are backward-looking; flat revenue (about $236M versus $236M a year ago) suggests a mature business whose margins could erode.
Valuation is rich at a 29.8x forward P/E and a PEG of 3.44, and the price is 2.8% above the $144.20 analyst target, so there is little upside left.
↓DeterioratingValuation breakdown
- Expectation
- Analyst targets get revised above the current price, or earnings growth catches up so forward P/E compresses toward the mid-20s.
CounterPremium multiples for a dividend-paying, high-quality compounder can persist, and analyst targets often lag price.
Earnings have recovered from an April miss of -24.0% to consecutive beats (+0.72% and +1.81%), with estimates trending up.
↓DeterioratingLast 4 quarters
- Expectation
- EPS beats continue over the next 4 quarters and the average surprise turns positive from -5.7%.
CounterBeats are slim (about 1-2%), the four-quarter average surprise is still -5.7%, and the April miss shows volatility.
Momentum is middling at 5.3/10 with falling on-balance volume, while 22% short interest creates two-way risk.
↑ImprovingMomentum breakdown
- Expectation
- Momentum score holds above 4.5 and volume confirms the trend over the next several quarters.
CounterFalling OBV signals distribution, and with the price above the analyst target, a crowded short position could add to downside if sentiment turns.
Per-dimension breakdown
Quality
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 6.2 |
| ROA | 7.2 |
| Gross margin | 4.3 |
| Op margin | 8.1 |
| Net margin | 7.2 |
| Current ratio | 8.4 |
| FCF quality | 6.9 |
| Moat | 6.5 |
| Piotroski F | 10.0 |
- ▸Strong Piotroski F-Score: 9/9
Growth
2.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.5 |
| EPS growth | 2.8 |
Momentum
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 8.0 |
| Volume | 0.0 |
- ▸Overbought (RSI 71)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 6.5 |
| Analyst rating | 6.8 |
| Price target | 5.6 |
- ▸Light analyst coverage (8.0) — signal dampened
Insider
5.5/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.9 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 3.2 |
| quality rank | 6.2 |
| growth rank | 0.6 |
- ▸Conservative debt levels
Technical
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 1.8 |
| support resistance | 1.9 |
| 52w position | 5.8 |
Risk (lower is worse)
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.2 |
| days to cover | 0.0 |
| volatility | 0.0 |
| put call | 10.0 |
| implied vol | 5.0 |
| max pain risk | 7.0 |
| beta | 9.3 |
| debt equity | 9.9 |
- ▸Short squeeze setup: 22% short, quality 7.5
- ▸Concentration risks: 2 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.0 |
| earnings history | 3.3 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 8.5 |
| news activity | 5.0 |
- ▸Earnings concerns: 2B/2M
- ▸Dividend aristocrat: 1.1% yield
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.5>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:83d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.6=NEGATIVE
Warning (1)
- DEATH_CROSS:momentum=6.5>=5.0 recovering
Reward-to-Risk
-0.62
Upside
-9.3%
Downside
15.0%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 71
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $4.7B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Quality at 7.2) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-0.6=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.62 — supplementary context, not the trigger for this path.
The strongest dimensions are Quality at 7.2, Momentum at 6.5, and Sentiment at 6.3; the weakest are Growth at 2.6, Technical at 3.2, and Value at 3.5. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -0.62 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Financial Strength
Trip ifQuality score falls below 6.0 from current 7.2.
- P2Rich Valuation Limited Upside
Trip ifAnalyst target rises above $165, more than 10% above the current $148.38 price.
- P3Earnings Execution Recovering
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P4Utility Water Concentration
Trip ifQuarterly revenue falls below $200M, below the $202M March 2026 quarter.
- P5Momentum Versus Short Interest
Trip ifMomentum score falls below 4.5 from current 5.3.