Should Third Quarter Earnings Require Action From Badger Meter Stock Investors?

• Badger Meter reported third quarter 2026 sales of US$235.94 million with net income of US$35.9 million and diluted EPS of US$1.24. Nine month figures showed lower sales and earnings than the prior year.
• Alongside these results, Badger Meter completed a share repurchase of 850,465 shares for about US$115.26 million, which modestly reduced the share count and may influence per share metrics going forward.
• We will now look at how Badger Meter's investment narrative is shaped by steady quarterly EPS alongside softer year to date performance.

Scan how Badger Meter's steady quarterly EPS and completed buyback compare with other cash generative industrials by reviewing the hand picked list of solid balance sheet and fundamentals (25 results).

Badger Meter Investment Narrative Recap

To own Badger Meter, you need to believe its smart water metering and software strategy can turn awarded projects into steadier earnings, even when shorter cycle municipal orders move around. The third quarter showed relatively firm quarterly EPS, while the nine month picture was softer, so execution on those large AMI and sewer monitoring deployments still matters most. The main near term swing factor remains how quickly utilities move from awards to installations.

The biggest operational risk is that timing gaps resurface on both sides, shorter cycle orders and project ramps, leaving utility water revenue choppy. Recent results do not materially change that risk, although they reassure that earnings have not broken down while revenue timing has been uneven so far in 2026. Legal and governance issues also sit in the background as a potential drag on costs and management focus.

The completed repurchase of 850,465 shares for about US$115.26 million is the clearest secondary angle to this quarter. The buyback trims the share count, which can support per share figures when net income is broadly stable. It also signals that Badger Meter has had room on the balance sheet to return cash while still funding its AMI, sewer and software build out.

For you as a shareholder, the key question is how that capital return fits alongside the execution risk on large awarded projects like PRASA and the broader AMI 2.0 and BlueEdge rollout. If deployments accelerate, EPS could benefit from both operating leverage and the smaller share base. Any renewed lumpiness in orders, legal costs or project delays would work in the opposite direction and limit the benefit from the completed buyback.

Badger Meter's current analyst narrative points to forecast revenues of US$1.1b and earnings of US$179.0 million by 2029. That outlook assumes revenue growth of 8.3% per year and an earnings increase of about US$52.5 million from US$126.5 million today.

Uncover how Badger Meter's fair value indicates a 10% potential upside to its current price before that valuation gap closes.

Exploring Other Perspectives

One optimistic twist in the Badger Meter story focuses on software. The most bullish analysts were already penciling in about US$1.2b of revenue and US$190.6 million of earnings by 2029, assuming stronger SaaS traction than the consensus case. With the latest earnings and buyback now out, those richer software expectations may either gain support or face a rethink. Readers can use this gap to compare several viewpoints before forming a personal view on Badger Meter.

Explore 4 other Badger Meter fair value estimates, including one that suggests as much as 26% upside from the current price!

Decide For Yourself

Don't just follow the ticker. Dig into the data and build a conviction that's truly your own.

• A great starting point for your Badger Meter research is our analysis highlighting 1 key reward that could impact your investment decision.
• See our latest analysis for Badger Meter. The report includes a comprehensive fundamental analysis summarized in a single visual, the Snowflake, making it easy to evaluate Badger Meter's overall financial health at a glance.

Looking for more Badger Meter investment ideas?

Once you have a view on Badger Meter, it can help to compare it with other opportunities that share similar traits in terms of quality, balance sheet strength or risk profile. The Simply Wall St Screener offers several hand picked sets of companies that can broaden your watchlist and sharpen your sense of what looks attractive right now.

• For investors who care most about financial resilience and clean balance sheets, start with a list of solid balance sheet and fundamentals (25 results) to see businesses that keep debt in check while backing their operations with solid fundamentals.
• If value matters to you and you like the idea of strong cash generation at a price that looks reasonable, scan the 29 high quality undervalued stocks to spot companies where quality and valuation currently line up.
• Those who prefer a calmer ride can review the 30 resilient stocks with low risk scores and focus on stocks that screen well on Simply Wall St's internal risk measures.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com