Core Insights - Mueller Water Products, Inc. reported a 4.6% increase in net sales to $318.2 million for the first quarter of fiscal 2026, compared to $304.3 million in the prior year quarter [1][5][6] - The company achieved a reported net income of $43.2 million, or $0.27 per diluted share, reflecting a 22.4% increase from $35.3 million, or $0.22 per diluted share, in the prior year [1][12][41] - Adjusted EBITDA rose 13.5% to $72.1 million, with an adjusted EBITDA margin expansion to 22.7% from 20.9% in the prior year [1][13][27] Financial Performance - Net sales increased by $13.9 million, or 4.6%, primarily due to higher pricing across most product lines, partially offset by slightly lower volumes [6] - Gross profit increased by $16.8 million, or 16.3%, to $119.8 million, with a gross margin of 37.6%, up 380 basis points from the prior year [7] - Operating income rose by $9.3 million, or 19.6%, to $56.7 million, with an operating margin of 17.8%, compared to 15.6% in the prior year [9] Adjusted Metrics - Adjusted operating income increased by $7.6 million, or 14.5%, to $60.0 million, with an adjusted operating margin of 18.9%, up from 17.2% in the prior year [11] - Adjusted net income rose by $6.6 million, or 16.8%, to $45.8 million, with adjusted net income per diluted share increasing to $0.29 from $0.25 [12][46] Cash Flow and Capital Expenditures - Net cash provided by operating activities increased by $7.1 million to $61.2 million, driven by higher net income and non-cash adjustments [23] - Free cash flow for the quarter was $44.0 million, up from $42.2 million in the prior year, despite higher capital expenditures of $17.2 million compared to $11.9 million [25][44] Fiscal 2026 Outlook - The company raised its fiscal 2026 guidance for consolidated net sales to between $1,470 million and $1,490 million, representing a 2.8% to 4.2% increase compared to the prior year [27] - Adjusted EBITDA expectations for fiscal 2026 were increased to between $355 million and $360 million, an increase of 8.8% to 10.4% compared to the prior year [27]

Core Insights - The Zacks Industrial Products sector is expected to face a year-over-year earnings decline of 2.1% in Q4 2025, contrasting with a 3% growth in the previous quarter, while revenues are projected to increase by 10.5% [3] Industry Overview - The Industrial Products sector is experiencing challenges due to ongoing weakness in the manufacturing sector, with the Manufacturing PMI indicating contraction for ten consecutive months [5] - The New Orders Index has also shown a decline, with readings of 48.7%, 47.3%, and 47.4% for October, November, and December respectively [6] - Inflationary pressures, labor market slack, supply-chain disruptions, and cautious consumer spending are impacting the sector's performance [7] Positive Factors - Companies involved in commercial and defense aerospace markets are benefiting from strong aftermarket and OEM demand, supported by robust air travel and government backing [8] - Resilience in nondurables, business supplies, and food & beverage markets is expected to positively influence the sector's results [8] Earnings Estimates and Stock Performance - Kennametal Inc. (KMT) is projected to report a 40% year-over-year increase in Q4 EPS, driven by strength in the Metal Cutting segment and increased defense spending [12][13] - Mueller Water Products, Inc. (MWA) is expected to see an 8% year-over-year increase in earnings, supported by solid demand across its product lines and manufacturing efficiencies [14][15] - Trimble Inc. (TRMB) anticipates a 7.9% year-over-year increase in earnings, benefiting from strong growth in recurring revenue streams and customer adoption of digital solutions [16][17]

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 - Mueller Water Products, Inc. is set to release its financial results for the first quarter ending December 31, 2025, on February 4, 2026, after U.S. market close, followed by a conference call on February 5, 2026, at 11:00 a.m. ET to discuss the earnings and business results [1]. Company Overview - Mueller Water Products, Inc. is a prominent manufacturer and marketer of products and solutions for the transmission, distribution, and measurement of water in North America [2]. - The company's extensive portfolio includes engineered valves, fire hydrants, pipe connection and repair products, metering products, leak detection, pipe condition assessment, pressure management products, and software that provides essential water system data [2]. - Mueller Water Products aims to assist municipalities in enhancing operational efficiencies, improving customer service, and prioritizing capital spending, reinforcing its position as a leader in the industry [2].

Core Viewpoint - Investors in the Manufacturing - General Industrial sector should consider Mueller Water Products (MWA) and Nordson (NDSN) for potential value opportunities [1] Group 1: Company Rankings and Outlook - Both MWA and NDSN currently hold a Zacks Rank of 2 (Buy), indicating a positive earnings outlook supported by favorable analyst estimate revisions [3] - The Zacks Rank system emphasizes companies with improving earnings forecasts, which is a key interest for value investors [2] Group 2: Valuation Metrics - MWA has a forward P/E ratio of 17.90, while NDSN has a higher forward P/E of 23.35, suggesting MWA may be more attractively priced [5] - MWA's PEG ratio is 1.19, indicating a better valuation relative to its expected EPS growth compared to NDSN's PEG ratio of 1.80 [5] - MWA's P/B ratio stands at 4.02, compared to NDSN's P/B of 4.82, further supporting MWA's stronger valuation metrics [6] Group 3: Value Grades - MWA has received a Value grade of B, while NDSN has a Value grade of D, indicating that MWA is currently viewed as the superior value option [6][7]

Core Insights - Piper Sandler's "Macro Select" stock-picking model significantly outperformed the S&P 500 in 2025, achieving a return of approximately 22% compared to the S&P 500's 16% gain [1] - The updated Macro Select list for 2026 focuses on stocks with strong earnings surprises, earnings revisions, attractive earnings yield, and high return on equity (ROE) [3] Stock Performance - AT&T Inc. (Ticker: T) in the Communication Services sector had a 1-year return of 10% [5] - Graham Holdings (Ticker: GHC) in the Consumer Discretionary sector had a 1-year return of 4% [6] - Par Pacific Holdings (Ticker: EAT) in the Consumer Discretionary sector had a 1-year return of 12% [7] - Deluxe Corporation (Ticker: PARR) in the Energy sector had a 1-year return of 13% [8] - Mueller Water Products (Ticker: MWA) in the Industrials sector had a 1-year return of 14% [10] - Kilroy Realty (Ticker: KRC) in the Real Estate sector had a 1-year return of 6% [11] - UGI Corporation (Ticker: UGI) in the Utilities sector had a 1-year return of 33% [12] - Clearway Energy (Ticker: CWEN) in the Utilities sector had a 1-year return of 23% [13]

Core Viewpoint - Mueller Water Products, Inc. has nominated Gregg C. Sengstack to join its Board of Directors, while Thomas Hansen will retire from the Board at the upcoming Annual Meeting on February 9, 2026 [1][2]. Group 1: Board Changes - The Board of Directors has nominated Gregg C. Sengstack, who previously served as a Board Observer, to enhance the Board's operational and financial expertise [3]. - Thomas Hansen is recognized for his significant contributions and long-standing service to the company [2]. - Following the Annual Meeting, the Board will consist of nine directors, with eight being independent and all having joined within the past seven years [3]. Group 2: Background of Gregg C. Sengstack - Gregg C. Sengstack has over 30 years of experience in manufacturing leadership, international market development, and financial stewardship [4]. - He served as Chairperson and CEO of Franklin Electric Co. from 2014 to July 2024, where he led a strategic transformation that significantly increased shareholder value [5]. - Sengstack holds an MBA from the University of Chicago and a BA in Mathematics and Economics from Bucknell University [6]. Group 3: Company Overview - Mueller Water Products, Inc. is a leading manufacturer and marketer of products for the transmission, distribution, and measurement of water in North America [7]. - The company's product portfolio includes engineered valves, fire hydrants, metering products, and software for critical water system data [7].

Company Overview - Mueller Water Products (MWA) specializes in engineering valves, hydrants, and metering systems for water infrastructure [1] - The company operates through two reportable segments: Water Flow Solutions and Water Management Solutions [1] - MWA's operations are primarily based in the United States and Canada [1] Analyst Background - The analyst has over 10 years of experience in the investment arena, starting as an analyst and advancing to a management role [1] - The analyst holds a master's degree in Analytics from Northwestern University and a bachelor's degree in Accounting [1] - Dividend investing is a personal interest of the analyst, who aims to share insights with the Seeking Alpha community [1]

Group 1 - Crude Value Insights provides an investment service and community focused on the oil and natural gas sectors, emphasizing cash flow and companies that generate it [1] - The service offers subscribers access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live chat discussions about the sector [1] Group 2 - A two-week free trial is available for new subscribers, promoting engagement with the oil and gas market [2]

Group 1 - Crude Value Insights provides an investment service and community focused on the oil and natural gas sector, emphasizing cash flow and companies that generate it [1] - The service offers subscribers access to a model account with over 50 stocks, detailed cash flow analyses of exploration and production (E&P) firms, and live chat discussions about the sector [1] Group 2 - A two-week free trial is available for new subscribers, promoting engagement with the oil and gas market [2]