Core Insights - Badger Meter is positioned as a leader in the North American smart-water technology market, with significant growth potential as it transitions its client base to advanced metering infrastructure (AMI) [3][4] - The company is leveraging strategic acquisitions, such as the $185 million purchase of SmartCover, to enhance its product offerings and expand its client base [6][7] - Badger Meter's commitment to sustainability and efficient water use aligns with global trends, making it a compelling investment opportunity [9] Growth Pathways - Only 40% of Badger's connection points have transitioned to AMI, indicating substantial room for growth as customers upgrade their metering and monitoring equipment [3] - New capabilities in Badger's platform, including real-time water quality monitoring and high-frequency pressure monitoring, are expected to drive greater adoption among utility users [4] - The company aims to expand its international presence, particularly in Europe and the Middle East, by offering customized solutions [4] Strategic Acquisitions - The acquisition of SmartCover allows Badger to tap into the wastewater treatment sector and create cross-selling opportunities with existing customers [6][7] - This strategic move is expected to strengthen Badger's market position and enhance its growth trajectory [7] Financial Performance - Badger Meter has a market capitalization of $5.1 billion, with a gross margin of 41.26% and a dividend yield of 0.85% [6] - The company has a history of consistent dividend increases, with an 18% hike in August 2025 marking the 33rd consecutive year of annual increases [10] Investment Perspective - The Voyager Portfolio views Badger Meter as a long-term investment opportunity, anticipating that the company's growth will unfold over years or decades [8][11] - The increasing global demand for efficient water use positions Badger Meter favorably in the market, especially as water supply concerns become more pressing [9]

Group 1 - Technology stocks have significantly outperformed long-term market averages, and the benefits of technological innovation are extending beyond tech companies to those utilizing such innovations [1] - Badger Meter (NYSE: BMI) exemplifies how companies can leverage AI and advanced automation technology for growth, despite being less known in the market [2] - Badger Meter has evolved over its century-long history, focusing on water management expertise to drive financial growth [3] Group 2 - Badger Meter's strategy emphasizes the need for water utilities and commercial users to enhance control over water usage, addressing issues with older mechanical meters that lose accuracy over time [5] - The company has introduced new solutions, including cellular radios and monitoring software, which improve operational efficiency and provide valuable data insights [6] - Since 2020, Badger Meter has seen its revenue more than double, with an average annual growth rate of 28% in recurring revenue from its subscription-based monitoring software platform [7] Group 3 - The application of AI in water management is becoming increasingly relevant, with Badger Meter positioned to benefit from the "smart water" technology trend [8]

Group 1 - The stock selection process showed positive momentum in December, with an average gain of 0.83% for the selected 15 stocks [1] - The SPDR® S&P 500® ETF was mentioned as a benchmark for performance comparison [1] Group 2 - The analyst holds long positions in various companies, including ZTS, MSCI, DPZ, and others, through stock ownership, options, or derivatives [2] - The article reflects the analyst's personal opinions and is not influenced by compensation from any company mentioned [2]

Company Performance - Badger Meter (BMI) closed at $181.26, reflecting a -1.03% change from the previous day, underperforming the S&P 500 which gained 0.46% [1] - Over the last month, Badger Meter's shares increased by 2.99%, lagging behind the Computer and Technology sector's gain of 4.54% and the S&P 500's gain of 4.22% [2] - The upcoming earnings per share (EPS) is projected at $1.14, indicating a 9.62% increase year-over-year, with revenue expected to be $231.61 million, a 12.88% increase compared to the same quarter last year [3] - For the full year, earnings are projected at $4.79 per share and revenue at $927.59 million, representing increases of +13.24% and +12.22% respectively from the prior year [4] Analyst Insights - Recent revisions to analyst forecasts for Badger Meter should be monitored, as they reflect near-term business trends and analysts' confidence in the company's profitability [5] - The Zacks Rank system, which evaluates estimate changes, currently ranks Badger Meter at 4 (Sell), with the consensus EPS estimate having decreased by 0.13% over the past month [6][7] Valuation Metrics - Badger Meter is trading at a Forward P/E ratio of 38.22, which is a premium compared to the industry average Forward P/E of 24.25 [8] - The company has a PEG ratio of 3.02, higher than the industry average PEG ratio of 2.18, indicating a higher valuation relative to expected earnings growth [8] Industry Context - The Instruments - Control industry, part of the Computer and Technology sector, holds a Zacks Industry Rank of 102, placing it in the top 42% of over 250 industries [9]

Core Viewpoint - The article discusses the reliability of brokerage recommendations, particularly focusing on Badger Meter (BMI), and highlights the potential misalignment of interests between brokerage firms and retail investors [1][5]. Brokerage Recommendations - Badger Meter has an average brokerage recommendation (ABR) of 1.92, indicating a position between Strong Buy and Buy, based on recommendations from 12 brokerage firms [2]. - Of the 12 recommendations, six are classified as Strong Buy and one as Buy, representing 50% and 8.3% of total recommendations respectively [2]. Limitations of Brokerage Recommendations - Solely relying on brokerage recommendations for investment decisions may not be advisable, as studies suggest they often fail to guide investors effectively towards stocks with high price appreciation potential [5]. - Analysts from brokerage firms tend to exhibit a strong positive bias in their ratings, with five "Strong Buy" recommendations for every "Strong Sell" [6]. Zacks Rank as an Alternative - Zacks Rank, a proprietary stock rating tool, categorizes stocks from Zacks Rank 1 (Strong Buy) to Zacks Rank 5 (Strong Sell) and is considered a more effective indicator of near-term stock performance [8]. - The Zacks Rank is based on earnings estimate revisions, which are strongly correlated with stock price movements, unlike the ABR which may not be timely [12][13]. Current Earnings Estimates for Badger Meter - The Zacks Consensus Estimate for Badger Meter's current year earnings has decreased by 0.1% over the past month to $4.79, reflecting analysts' growing pessimism about the company's earnings prospects [14]. - This decline in consensus estimates has resulted in a Zacks Rank 4 (Sell) for Badger Meter, suggesting caution despite the Buy-equivalent ABR [15].

Core Viewpoint - Badger Meter, Inc. (NYSE:BMI) is recognized as a strong investment opportunity, particularly in the smart water metering sector, with a Buy rating initiated by Jefferies and a price target of $220, indicating confidence in the company's growth despite recent slowdowns [2][3]. Group 1: Company Performance and Growth - Badger Meter has a solid track record of acquisitions, completing 14 since 2010, which has reinforced its leadership in water technology [4]. - The company recently acquired SmartCover Systems for $185 million, and management is on track to achieve expected sales and cost synergies from this acquisition [4]. - Free cash flow (FCF) margins have significantly improved from approximately 6% in 2015 to around 18% today, driven by the expansion of software-as-a-service offerings [5]. Group 2: Dividend Growth and Financial Health - Badger Meter is positioned as a dividend growth story, with a current dividend yield of about 0.9%, utilizing only 25% of its FCF for dividend payments, allowing for potential future increases [6]. - The company has a history of raising its dividend for 33 consecutive years, indicating strong financial health and commitment to returning value to shareholders [6]. Group 3: Industry Position and Innovation - With over a century of innovation in water technology, Badger Meter provides comprehensive water management solutions through its BlueEdge suite, highlighting its industry expertise [7].

Core Insights - Transcat, Inc. (TRNS) shares increased by 5.4% to close at $59.24, driven by higher trading volume compared to typical sessions, and a 3.5% gain over the past four weeks [1][2] Company Performance - The recent uptrend in Transcat's shares is linked to optimism about a potential rebound in stock prices, supported by a holistic growth model focused on providing top-tier services and products to various regulated industries [2] - Transcat is expected to report quarterly earnings of $0.36 per share, reflecting a year-over-year decline of 20%, while revenues are projected to reach $81.93 million, marking a 22.7% increase from the previous year [4] Strategic Acquisitions - The acquisition of Complete Calibrations enhances Transcat's local calibration presence in Ireland, supporting growth in the life sciences market, while the purchase of e2b Calibration in Cleveland, OH, is anticipated to strengthen its footprint in the U.S. and Canada [3] Market Position - The consensus EPS estimate for Transcat has remained stable over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [5] - Transcat holds a Zacks Rank of 3 (Hold), indicating a neutral outlook within the Zacks Instruments - Control industry, where Badger Meter (BMI) also holds a similar rank [5]

Core Viewpoint - The report summarizes significant changes in stock ratings from various investment banks, highlighting potential investment opportunities and market impacts. Upgraded Ratings - Jefferies upgraded Lululemon (LULU) from "Underperform" to "Hold," raising the target price from $120 to $170, citing the CEO's impending departure as a "major positive" [5] - UBS upgraded American Airlines (AAL) from "Neutral" to "Buy," increasing the target price from $14 to $20, noting that the market has not fully recognized the potential for significant profit increases as corporate client revenue recovers [5] - JPMorgan upgraded Citigroup (C) from "Neutral" to "Overweight," raising the target price from $107 to $124, believing that a stable economic environment in 2026 will benefit Citigroup more than its peers [5] - Guggenheim upgraded Bristol-Myers Squibb (BMY) from "Neutral" to "Buy," setting a target price of $62 for 2026, indicating attractive risk-reward dynamics [5] - Deutsche Bank upgraded Allegiant Air (ALGT) from "Hold" to "Buy," with a target price of $105, highlighting a balanced supply-demand environment in the U.S. domestic airline market by 2026 [5] Downgraded Ratings - JPMorgan downgraded Roblox (RBLX) from "Overweight" to "Neutral," lowering the target price from $145 to $100, citing pressures on user engagement and profit margins [10] - Baird downgraded PayPal (PYPL) from "Outperform" to "Neutral," reducing the target price from $83 to $66, due to volatility in transaction volumes and uncertainties in platform upgrades [10] - Stifel downgraded RH (RH) from "Buy" to "Hold," cutting the target price from $320 to $165, reflecting a second revenue guidance cut for fiscal year 2025 [10] - Northland downgraded Ciena (CIEN) from "Outperform" to "Market Perform," maintaining a target price of $190, stating that positive factors are already reflected in the current stock price [10] - Cowen downgraded Veeva Systems (VEEV) from "Overweight" to "Market Perform," indicating potential order losses due to competition from Salesforce (CRM) [10] Initiated Coverage - Citigroup initiated coverage on Boeing (BA) with a "Buy" rating and a target price of $265, describing it as an "attractive large-cap transformation stock" [11] - Jefferies initiated coverage on Moderna (MRNA) with a "Hold" rating and a target price of $30, expecting growth in vaccine sales but requiring more performance increments to meet guidance [11] - UBS initiated coverage on AppFolio (APPF) with a "Buy" rating and a target price of $285, noting no signs of spending slowdown or new competitive pressures [11] - TD Cowen initiated coverage on Tyler Technologies (TYL) with a "Buy" rating and a target price of $650, projecting a 20% sustainable SaaS growth rate due to cloud migration projects [11] - Jefferies initiated coverage on Badger Meter (BMI) with a "Buy" rating and a target price of $220, suggesting recent stock pullbacks present an attractive entry point [11]

Core Viewpoint - Badger Meter, Inc. is implementing executive leadership changes to align with strategic priorities and enhance market leadership in cellular Advanced Metering Infrastructure (AMI) [1] Group 1: Executive Leadership Changes - The changes will take effect on January 1, 2026 [1] - Ken Bockhorst, the current Chairman, President, and CEO, expressed excitement about the new management structure [1]

Group 1 - The article does not provide any specific content related to company or industry analysis [1]