3 Reasons BMI Has Explosive Upside Potential

Jabin Bastian Wed, July 8, 2026 at 7:14 AM EDT 3 min read **

• BMI
• ^GSPC

3 Reasons BMI Has Explosive Upside Potential Over the past six months, Badger Meter's shares (currently trading at $147.03) have posted a disappointing 15.5% loss, well below the S&P 500's 9% gain. This was partly driven by its softer quarterly results and might have investors contemplating their next move.

Following the drawdown, is now an opportune time to buy BMI? Find out in our full research report, it's free.

Why Is Badger Meter a Good Business?

The developer of the world's first frost-proof water meter in 1905, Badger Meter (NYSE:BMI) provides water control and measure equipment to various industries.

1. Skyrocketing Revenue Shows Strong Momentum

A company's long-term sales performance can indicate its overall quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, Badger Meter grew its sales at an incredible 15.6% compounded annual growth rate. Its growth surpassed the average industrials company and shows its offerings resonate with customers.

Badger Meter Quarterly Revenue

2. Outstanding Long-Term EPS Growth

We track the long-term change in earnings per share (EPS) because it highlights whether a company's growth is profitable.

Badger Meter's EPS grew at 20.3% compounded annual growth rate over the last five years, higher than its 15.6% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Badger Meter Trailing 12-Month EPS (Non-GAAP)

3. Excellent Free Cash Flow Margin Boosts Reinvestment Potential

Free cash flow isn't a prominently featured metric in company financials and earnings releases, but we think it's telling because it accounts for all operating and capital expenses, making it tough to manipulate. Cash is king.

Badger Meter has shown terrific cash profitability, putting it in an advantageous position to invest in new products, return capital to investors, and consolidate the market during industry downturns. The company's free cash flow margin was among the best in the industrials sector, averaging 15.8% over the last five years.

Badger Meter Trailing 12-Month Free Cash Flow Margin

Final Judgment

These are just a few reasons why we think Badger Meter is one of the best industrials companies out there. With the recent decline, the stock trades at 31.8× forward P/E (or $147.03 per share). Is now the time to initiate a position? See for yourself in our comprehensive research report, it's free.

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