Group 1 - Gabelli Funds, LLC will host the 36th Annual Pump, Valve, & Water Systems Symposium on February 26, 2026, in New York, NY [1] - The symposium will focus on discussions related to critical infrastructure, aerospace and defense, machine tools, and the oil and gas industry [2] - Attendees will have opportunities for one-on-one meetings with management from participating companies [2] Group 2 - Participating companies include AMETEK, Graco, Badger Meter, ITT, Crane, Landis+Gyr, Enpro, Mueller Water Products, Flowserve, Oil States International, Franklin Electric, and Watts Water Technologies [2] - A lunch presentation will be given by Robert Powelson, President & CEO of the National Association of Water Companies [3]

Core Viewpoint - Badger Meter, Inc. is recognized as a solid company in the smart-water technology market, but faces challenges due to its premium valuation and expected growth slowdown as the market matures [2][3]. Group 1: Company Overview - Badger Meter, Inc. (NYSE:BMI) is a manufacturer and marketer of flow measurement, water quality, and control solutions, serving customers globally [4]. - The company is an early leader in North America's smart-water tech market, with approximately 40% of its connection points migrated to its Advanced Metering Infrastructure (AMI) platform [3]. Group 2: Growth Opportunities - Badger Meter anticipates increased adoption of its AMI platform as customers replace outdated equipment and new features, such as real-time water quality and pressure monitoring, enhance the value of upgrades [3]. - The company is targeting growth through flow instrumentation opportunities in industrial and smart-building applications, as well as expanding into international markets like Europe and the Middle East [3]. Group 3: Acquisitions - Acquisitions are a key growth driver for Badger Meter, exemplified by its $185 million acquisition of SmartCover in early 2025, which enhances its wastewater monitoring capabilities and creates cross-selling opportunities [4].

Core Viewpoint - The article presents a bearish perspective on Badger Meter (BMI), suggesting that the stock is "priced to perfection" and may not offer value at current levels [1]. Company Analysis - Badger Meter has been under scrutiny for its stock valuation, with the author expressing concerns about its pricing relative to performance metrics [1]. Market Context - The author emphasizes the importance of understanding equity markets and their performance, indicating a broader analytical approach to investment [1].

Core Insights - Badger Meter is positioned as a leader in the North American smart-water technology market, with significant growth potential as it transitions its client base to advanced metering infrastructure (AMI) [3][4] - The company is leveraging strategic acquisitions, such as the $185 million purchase of SmartCover, to enhance its product offerings and expand its client base [6][7] - Badger Meter's commitment to sustainability and efficient water use aligns with global trends, making it a compelling investment opportunity [9] Growth Pathways - Only 40% of Badger's connection points have transitioned to AMI, indicating substantial room for growth as customers upgrade their metering and monitoring equipment [3] - New capabilities in Badger's platform, including real-time water quality monitoring and high-frequency pressure monitoring, are expected to drive greater adoption among utility users [4] - The company aims to expand its international presence, particularly in Europe and the Middle East, by offering customized solutions [4] Strategic Acquisitions - The acquisition of SmartCover allows Badger to tap into the wastewater treatment sector and create cross-selling opportunities with existing customers [6][7] - This strategic move is expected to strengthen Badger's market position and enhance its growth trajectory [7] Financial Performance - Badger Meter has a market capitalization of $5.1 billion, with a gross margin of 41.26% and a dividend yield of 0.85% [6] - The company has a history of consistent dividend increases, with an 18% hike in August 2025 marking the 33rd consecutive year of annual increases [10] Investment Perspective - The Voyager Portfolio views Badger Meter as a long-term investment opportunity, anticipating that the company's growth will unfold over years or decades [8][11] - The increasing global demand for efficient water use positions Badger Meter favorably in the market, especially as water supply concerns become more pressing [9]

Group 1 - Technology stocks have significantly outperformed long-term market averages, and the benefits of technological innovation are extending beyond tech companies to those utilizing such innovations [1] - Badger Meter (NYSE: BMI) exemplifies how companies can leverage AI and advanced automation technology for growth, despite being less known in the market [2] - Badger Meter has evolved over its century-long history, focusing on water management expertise to drive financial growth [3] Group 2 - Badger Meter's strategy emphasizes the need for water utilities and commercial users to enhance control over water usage, addressing issues with older mechanical meters that lose accuracy over time [5] - The company has introduced new solutions, including cellular radios and monitoring software, which improve operational efficiency and provide valuable data insights [6] - Since 2020, Badger Meter has seen its revenue more than double, with an average annual growth rate of 28% in recurring revenue from its subscription-based monitoring software platform [7] Group 3 - The application of AI in water management is becoming increasingly relevant, with Badger Meter positioned to benefit from the "smart water" technology trend [8]

Group 1 - The stock selection process showed positive momentum in December, with an average gain of 0.83% for the selected 15 stocks [1] - The SPDR® S&P 500® ETF was mentioned as a benchmark for performance comparison [1] Group 2 - The analyst holds long positions in various companies, including ZTS, MSCI, DPZ, and others, through stock ownership, options, or derivatives [2] - The article reflects the analyst's personal opinions and is not influenced by compensation from any company mentioned [2]

Company Performance - Badger Meter (BMI) closed at $181.26, reflecting a -1.03% change from the previous day, underperforming the S&P 500 which gained 0.46% [1] - Over the last month, Badger Meter's shares increased by 2.99%, lagging behind the Computer and Technology sector's gain of 4.54% and the S&P 500's gain of 4.22% [2] - The upcoming earnings per share (EPS) is projected at $1.14, indicating a 9.62% increase year-over-year, with revenue expected to be $231.61 million, a 12.88% increase compared to the same quarter last year [3] - For the full year, earnings are projected at $4.79 per share and revenue at $927.59 million, representing increases of +13.24% and +12.22% respectively from the prior year [4] Analyst Insights - Recent revisions to analyst forecasts for Badger Meter should be monitored, as they reflect near-term business trends and analysts' confidence in the company's profitability [5] - The Zacks Rank system, which evaluates estimate changes, currently ranks Badger Meter at 4 (Sell), with the consensus EPS estimate having decreased by 0.13% over the past month [6][7] Valuation Metrics - Badger Meter is trading at a Forward P/E ratio of 38.22, which is a premium compared to the industry average Forward P/E of 24.25 [8] - The company has a PEG ratio of 3.02, higher than the industry average PEG ratio of 2.18, indicating a higher valuation relative to expected earnings growth [8] Industry Context - The Instruments - Control industry, part of the Computer and Technology sector, holds a Zacks Industry Rank of 102, placing it in the top 42% of over 250 industries [9]

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Badger Meter (BMI), and highlights the potential misalignment of interests between brokerage firms and retail investors [1][5]. Brokerage Recommendations - Badger Meter has an average brokerage recommendation (ABR) of 1.92, indicating a position between Strong Buy and Buy, based on recommendations from 12 brokerage firms [2]. - Of the 12 recommendations, six are classified as Strong Buy and one as Buy, representing 50% and 8.3% of total recommendations respectively [2]. Limitations of Brokerage Recommendations - Solely relying on brokerage recommendations for investment decisions may not be advisable, as studies suggest they often fail to guide investors effectively towards stocks with high price appreciation potential [5]. - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, with five "Strong Buy" recommendations for every "Strong Sell" [6]. Zacks Rank as an Alternative - Zacks Rank, a proprietary stock rating tool, categorizes stocks from Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) and is considered a more effective indicator of near-term stock performance [8]. - The Zacks Rank is based on earnings estimate revisions, which are strongly correlated with stock price movements, unlike the ABR which may not be timely [12][13]. Current Earnings Estimates for Badger Meter - The Zacks Consensus Estimate for Badger Meter's current year earnings has decreased by 0.1% over the past month to $4.79, reflecting analysts' growing pessimism about the company's earnings prospects [14]. - This decline in consensus estimates has resulted in a Zacks Rank 4 (Sell) for Badger Meter, suggesting caution despite the Buy-equivalent ABR [15].

Core Viewpoint - Badger Meter, Inc. (NYSE:BMI) is recognized as a strong investment opportunity, particularly in the smart water metering sector, with a Buy rating initiated by Jefferies and a price target of $220, indicating confidence in the company's growth despite recent slowdowns [2][3]. Group 1: Company Performance and Growth - Badger Meter has a solid track record of acquisitions, completing 14 since 2010, which has reinforced its leadership in water technology [4]. - The company recently acquired SmartCover Systems for $185 million, and management is on track to achieve expected sales and cost synergies from this acquisition [4]. - Free cash flow (FCF) margins have significantly improved from approximately 6% in 2015 to around 18% today, driven by the expansion of software-as-a-service offerings [5]. Group 2: Dividend Growth and Financial Health - Badger Meter is positioned as a dividend growth story, with a current dividend yield of about 0.9%, utilizing only 25% of its FCF for dividend payments, allowing for potential future increases [6]. - The company has a history of raising its dividend for 33 consecutive years, indicating strong financial health and commitment to returning value to shareholders [6]. Group 3: Industry Position and Innovation - With over a century of innovation in water technology, Badger Meter provides comprehensive water management solutions through its BlueEdge suite, highlighting its industry expertise [7].

Core Insights - Transcat, Inc. (TRNS) shares increased by 5.4% to close at $59.24, driven by higher trading volume compared to typical sessions, and a 3.5% gain over the past four weeks [1][2] Company Performance - The recent uptrend in Transcat's shares is linked to optimism about a potential rebound in stock prices, supported by a holistic growth model focused on providing top-tier services and products to various regulated industries [2] - Transcat is expected to report quarterly earnings of $0.36 per share, reflecting a year-over-year decline of 20%, while revenues are projected to reach $81.93 million, marking a 22.7% increase from the previous year [4] Strategic Acquisitions - The acquisition of Complete Calibrations enhances Transcat's local calibration presence in Ireland, supporting growth in the life sciences market, while the purchase of e2b Calibration in Cleveland, OH, is anticipated to strengthen its footprint in the U.S. and Canada [3] Market Position - The consensus EPS estimate for Transcat has remained stable over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [5] - Transcat holds a Zacks Rank of 3 (Hold), indicating a neutral outlook within the Zacks Instruments - Control industry, where Badger Meter (BMI) also holds a similar rank [5]