Badger Meter shares slide over 5% as Q3 results disappoint

MILWAUKEE - Badger Meter, Inc. (NYSE:BMI ) reported third quarter earnings that fell short of analyst expectations, sending shares down 5.88% in trading on Thursday.

The water technology company posted adjusted earnings per share of $1.08, missing the consensus estimate of $1.11. Revenue came in at $208.4 million, below analyst projections of $212.08 million but up 12% YoY from $186.2 million.

Despite the miss, Badger Meter highlighted strong sales growth and record operating profit margins in the quarter. Total sales increased 12% YoY, driven by a 14% rise in utility water sales. The company achieved record operating profit margins of 19.5%, up 260 basis points from 16.9% a year ago.

"We were pleased with our third quarter financial performance delivering strong sales growth, record operating profit margins and robust cash flow generation," said Kenneth C. Bockhorst, Chairman, President and CEO.

For the fourth quarter, Badger Meter expects fewer operating days due to holidays and potential project delays in the Southeast U.S. from hurricane recovery efforts. The company anticipates delivering high single-digit sales growth rates over the cycle.

"We continue to strive for modest operating profit margin expansion year-over-year, driven by favorable structural sales mix, value-based price/cost management and SEA leverage," Bockhorst added.

Badger Meter increased its annual dividend rate by 26% to $1.36 per share, marking the 32nd consecutive year of dividend growth.

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Source: Investing.com