Core Thesis - Badger Meter, Inc. (BMI) is positioned as a leading provider of smart water infrastructure solutions, with a strong focus on recurring software and service revenue, which is growing faster than hardware sales [2][3] Company Overview - BMI serves over 50,000 local utilities in the U.S., providing a comprehensive portfolio of hardware, connectivity, and software under the BlueEdge platform, including advanced metering infrastructure (AMI) systems [2] - Approximately 88% of BMI's revenue is derived from its Utility Water segment, with a historical revenue growth of roughly 9% and earnings growth of 17% over the past decade [3] Competitive Advantages - The company benefits from integrated hardware-software systems, technical precision, long product lifecycles, and high switching costs, although it faces robust competition and limited pricing power [4] - Profitability is supported by efficient production, low capital intensity, and disciplined R&D, resulting in a free cash flow yield that funds dividends and growth initiatives [4] Financial Position - BMI maintains a net cash position with minimal debt, providing flexibility for future development [5] - The company has a 33-year record of dividend growth and predictable long-term demand driven by regulatory requirements and infrastructure renewal [5] Market Performance - As of January 30th, BMI's share price was $146.58, with trailing and forward P/E ratios of 30.15 and 27.78 respectively [1] - The stock price has depreciated by approximately 33.13% since previous coverage, attributed to broader market adjustments and high valuation [7]