Mueller Water Products (MWA) Tests Infrastructure Funding Story Following Pullback With Fair Value Still Higher

Mueller Water Products (MWA) continues to attract attention after recent trading left the share price at US$22.02, with performance over the past month and past 3 months highlighting a weaker stretch for the stock.

Over the past year, momentum around Mueller Water Products has cooled, with the share price return year to date down 8.02% and the 30 day share price return down 11.71%. However, the 3 year total shareholder return of 84.05% and 5 year total shareholder return of 51.59% still reflect a much stronger long term journey for investors.

Scan beyond Mueller Water Products and compare this pullback with other infrastructure focused businesses using our curated list of 40 power grid technology and infrastructure stocks

For Mueller Water Products, the pullback has reset expectations after a strong multi year run. Is the recent slide creating fresh upside, or has most of the easy gain already happened before this drop in price?

Most Popular Narrative: 25% Undervalued

Against a last close of $22.02, the most followed Mueller Water Products narrative anchors on a fair value of $29.50. This points to a meaningful gap that depends on infrastructure spending, margin work and smart water adoption staying on track.

Anticipated roll-out and eventual allocation of federal and state infrastructure funding (e.g., Infrastructure Investment and Jobs Act), even if delayed, is expected to act as a multi-year catalyst for order volumes and revenue growth, given the long runway and bipartisan focus on water infrastructure.

See why 12 investors see Mueller Water Products as 25% undervalued.

Result: Fair Value of $29.50 (UNDERVALUED)

Still, the Mueller Water Products story could change quickly if federal infrastructure funding is delayed, or if municipal and residential demand stays weaker for longer.

Find out about the key risks to this Mueller Water Products narrative.

Next Steps

If the mixed narrative around Mueller Water Products leaves you undecided, it may be helpful to review the numbers and context yourself. To see both sides of the story in one place, start with the 4 key rewards and 1 important warning sign.

Looking for more investment ideas beyond Mueller Water Products?

If Mueller Water Products feels like only part of your watchlist, you can use this pullback as a prompt to refresh your broader opportunity set with focused screeners.

• Target potential mispricings by scanning a curated set of undervalued companies through the 29 high quality undervalued stocks.
• Build resilience into your portfolio by filtering for businesses with stronger balance sheets using the list of solid balance sheet and fundamentals (23 results).
• Hunt for lesser known opportunities by reviewing a hand picked pool of 16 high quality undiscovered gems.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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