Badger Meter, Inc.
), in an effort to add value to shareholders, has increased its
quarterly dividend by 1 cent to 17 cents per share. This translates
to a 6.25% increase from the prior dividend of 16 cents. The
revised dividend will be paid on September 14, 2012, to
stockholders of record as of August 31, 2012.
This hike marks the 20th consecutive year of dividend increase for
Badger Meter. Last August, Badger Meter hiked its quarterly
dividend by 14.3% to 16 cents per share.
However, the news did not provide much impetus to the stock, as the
share price of Badger Meter rose just 0.8% or 28 cents to close at
$34.16 last Friday. The forward dividend yield based on the new
payout and the last closing price is roughly 2%.
Nevertheless, Badger Meter's commitment towards increasing
shareholders' return reflects its strong liquidity. The company
ended its second-quarter 2012 with cash and cash equivalents of
Badger Meter reported earnings of 52 cents per share, missing the
Zacks Consensus Estimate of 54 cents during second-quarter 2012.
Total revenues rose 9% year over year to $82 million, missing the
Zacks Consensus Estimate of $86 million.
Badger Meter continues to reallocate its free cash flow in
repurchasing shares along with paying dividend religiously. During
the reported quarter, the company completed share repurchase of its
previously announced $30 million stocks. It repurchased nearly
888,000 shares at an average price of $33.78 per share.
Badger Meter's recent acquisition of Racine Federated, Inc., along
with its previously acquired Cox Flow Measurement and Remag is
expected to accelerate its flow of measurement business globally.
The company expects to benefit from the synergies.
Moreover, the new products introduced by the company including
ORION SE Advanced metering analytics system and the Electronic
E-Series received wide acceptance among its customers.
BADGER METER (BMI): Free Stock Analysis Report
ITRON INC (ITRI): Free Stock Analysis Report
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However, the ongoing global economic weakness along with the
uncertain municipal financial capabilities may affect the
performance of Badger Meter moving forward. Weak housing starts may
also worsen the situation.
Badger Meter competes with
) which does not pay any dividend. The company retains a short-term
Zacks #3 Rank (Hold). We have a long-term Neutral recommendation on