We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Badger Meter (BMI) Up 12.4% Since Last Earnings Report: Can It Continue?
Read MoreHide Full Article
A month has gone by since the last earnings report for Badger Meter (BMI - Free Report) . Shares have added about 12.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Badger Meter due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Badger Meter Q4 Earnings Meet Estimates, Revenues Rise
Badger Meter reported modest fourth-quarter 2020 results, with net earnings and revenues increasing year over year.
Net Income
Quarterly net earnings for the reported quarter were $13.1 million or 45 cents per share compared with $12.3 million or 42 cents per share in the year-ago quarter. The year-over-year improvement can be primarily attributed to higher revenues. The bottom line matched the Zacks Consensus Estimate. For full year 2020, the company recorded net income of $49.3 million or $1.69 per share compared with $47.2 million or $1.61 per share in 2019.
Revenues
Quarterly net sales increased to $112.3 million from $107.6 million in the year-ago quarter primarily due to a surge in manufacturing output with consistent demand post COVID-19-induced lockdown and incremental revenues from the acquisition of s::can. Also, the company witnessed a favorable mix of high-end products and services along with higher BEACON Software as a Service revenues. The top line surpassed the consensus mark of $111 million. For full year 2020, the company recorded revenues of $425.5 million compared with $424.6 million in 2019.
The company continued to witness higher demand for and adoption of new technology products and solutions like ORION Cellular radios and ultrasonic meter technology, which contributed to the sales growth in the reported quarter. However, flow instrumentation declined 10% year over year due to sluggish industrial end markets, particularly due to challenges posed by the COVID-19 outbreak.
Other Details
Gross profit was $44.1 million, up from $41.1 million in the year-earlier quarter. Gross margin was 39.2%, up 100 basis points (bps) year over year. The upside was primarily driven by favorable sales mix and higher sales volume. Operating earnings were $17 million or 15.1% of sales compared with respective tallies of $16.2 million and 15.2% in the year-earlier quarter.
Selling, engineering and administration expenses were $27.1 million compared with $24.8 million in the prior-year quarter. The increase was primarily due to higher personnel costs. However, it was partially offset by lower travel and other pandemic-related expenses.
Cash Flow & Liquidity
In 2020, Badger Meter generated $89.6 million of net cash from operations compared with $80.7 million in the prior-year period, driven by strong earnings conversion. Free cash flow for 2020 was $80.5 million, up 10% year over year. With a stable free cash flow, the company’s performance was driven by a robust balance sheet position along with an effective working capital management. As of Dec 31, 2020, the company had $72.3 million in cash and equivalents with no short-term debt compared with respective tallies of $48.9 million and $4.5 million in the prior-year period.
Moving Forward
With the gradual stabilization of overall end-market activities post lockdowns, Badger Meter remains optimistic related to its near-term outlook. The Milwaukee, WI-based controls products manufacturer expects to witness solid backlog and bid pipeline on the back of increasing orders in the upcoming quarters. This will eventually help the company to ensure smooth functioning of business operations. Although a small portion of customers could face budget constraints with project deferrals, Badger Meter remains committed to delivering critical products and services to its diversified customer base during this hour of crisis.
The company is well poised to benefit from strategic, tuck-in mergers and acquisitions and augment offerings across global markets with a strong liquidity position. Badger Meter is focused on investing in digital solutions that operationalize real-time data and utilize remote solutions to reduce overall costs and enhance efficiency. For additional financial flexibility, the company has $125 million under revolving credit facility to fund capital allocation priorities. Customer demand is anticipated to be the crux of product and technology roadmap, with competitive share and positioning. Continued R&D investments with inventory planning capabilities are likely to provide potential opportunities in the future.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Badger Meter (BMI) Up 12.4% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Badger Meter (BMI - Free Report) . Shares have added about 12.4% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Badger Meter due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Badger Meter Q4 Earnings Meet Estimates, Revenues Rise
Badger Meter reported modest fourth-quarter 2020 results, with net earnings and revenues increasing year over year.
Net Income
Quarterly net earnings for the reported quarter were $13.1 million or 45 cents per share compared with $12.3 million or 42 cents per share in the year-ago quarter. The year-over-year improvement can be primarily attributed to higher revenues. The bottom line matched the Zacks Consensus Estimate. For full year 2020, the company recorded net income of $49.3 million or $1.69 per share compared with $47.2 million or $1.61 per share in 2019.
Revenues
Quarterly net sales increased to $112.3 million from $107.6 million in the year-ago quarter primarily due to a surge in manufacturing output with consistent demand post COVID-19-induced lockdown and incremental revenues from the acquisition of s::can. Also, the company witnessed a favorable mix of high-end products and services along with higher BEACON Software as a Service revenues. The top line surpassed the consensus mark of $111 million. For full year 2020, the company recorded revenues of $425.5 million compared with $424.6 million in 2019.
The company continued to witness higher demand for and adoption of new technology products and solutions like ORION Cellular radios and ultrasonic meter technology, which contributed to the sales growth in the reported quarter. However, flow instrumentation declined 10% year over year due to sluggish industrial end markets, particularly due to challenges posed by the COVID-19 outbreak.
Other Details
Gross profit was $44.1 million, up from $41.1 million in the year-earlier quarter. Gross margin was 39.2%, up 100 basis points (bps) year over year. The upside was primarily driven by favorable sales mix and higher sales volume. Operating earnings were $17 million or 15.1% of sales compared with respective tallies of $16.2 million and 15.2% in the year-earlier quarter.
Selling, engineering and administration expenses were $27.1 million compared with $24.8 million in the prior-year quarter. The increase was primarily due to higher personnel costs. However, it was partially offset by lower travel and other pandemic-related expenses.
Cash Flow & Liquidity
In 2020, Badger Meter generated $89.6 million of net cash from operations compared with $80.7 million in the prior-year period, driven by strong earnings conversion. Free cash flow for 2020 was $80.5 million, up 10% year over year. With a stable free cash flow, the company’s performance was driven by a robust balance sheet position along with an effective working capital management. As of Dec 31, 2020, the company had $72.3 million in cash and equivalents with no short-term debt compared with respective tallies of $48.9 million and $4.5 million in the prior-year period.
Moving Forward
With the gradual stabilization of overall end-market activities post lockdowns, Badger Meter remains optimistic related to its near-term outlook. The Milwaukee, WI-based controls products manufacturer expects to witness solid backlog and bid pipeline on the back of increasing orders in the upcoming quarters. This will eventually help the company to ensure smooth functioning of business operations. Although a small portion of customers could face budget constraints with project deferrals, Badger Meter remains committed to delivering critical products and services to its diversified customer base during this hour of crisis.
The company is well poised to benefit from strategic, tuck-in mergers and acquisitions and augment offerings across global markets with a strong liquidity position. Badger Meter is focused on investing in digital solutions that operationalize real-time data and utilize remote solutions to reduce overall costs and enhance efficiency. For additional financial flexibility, the company has $125 million under revolving credit facility to fund capital allocation priorities. Customer demand is anticipated to be the crux of product and technology roadmap, with competitive share and positioning. Continued R&D investments with inventory planning capabilities are likely to provide potential opportunities in the future.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.