Analysts have lowered their average price target for Badger Meter from $232.57 to $219.50. They cite recent earnings, modest topline performance, margin improvements, and ongoing market dynamics as key factors behind the adjustment.

Analyst Commentary

Recent street research reveals a range of perspectives on Badger Meter’s prospects, highlighting both the company’s strengths and the risks that have influenced revised targets and ratings.

Bullish Takeaways

• Bullish analysts point to Badger Meter’s consistent organic growth, including an 8% year-over-year increase, and strong sequential improvement in SmartCover performance as positive indicators for ongoing expansion.
• The company has demonstrated robust operational execution with core incrementals of 26% and a free cash flow conversion rate of 136%, supporting improved capital efficiency.
• An increase in the gross margin target into the 39% to 42% range and continued innovation in water metering technology are seen as drivers of higher profitability and market leadership.
• With its industry focus, Badger Meter is viewed as an attractive long-term holding for investors seeking exposure to structural trends such as water scarcity and infrastructure renewal.

Bearish Takeaways

• Cautious analysts note that while revenue met expectations, the topline performance remains modest, which could limit near-term valuation expansion.
• Recent downward adjustments to price targets are seen as reflecting broader market dynamics and concerns about the company’s elevated short interest and investor positioning.
• Some forecasts expect sales growth to reaccelerate only in future periods, suggesting a potential pause in momentum before fundamentals strengthen again.
• Despite strong execution, the run-up in share price may have been overextended relative to immediate results, prompting a reassessment of upside potential in the current market environment.

What's in the News

• The Board of Directors authorized an 18% increase in the quarterly common stock dividend to $0.40 per share. The new annual dividend rate is set at $1.60 per share. The increased dividend is payable on September 5, 2025, to shareholders of record as of August 22, 2025. (Key Developments)
• Between July 1, 2025 and September 30, 2025, Badger Meter repurchased 0 shares for $0 million, completing the repurchase announced on February 22, 2023. (Key Developments)

Valuation Changes

• Consensus Analyst Price Target has decreased from $232.57 to $219.50, reflecting a modest reduction of about 6%.
• Discount Rate has risen slightly, increasing from 8.22% to 8.24%.
• Revenue Growth projection has edged down from 8.53% to 8.34%.
• Net Profit Margin estimate has increased from 16.31% to 16.54%.
• Future P/E ratio forecast has dropped from 46.91x to 42.60x, which points to lower expected valuation multiples.