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Mueller Water Products (MWA)
NYSE:MWA
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Mueller Water Products
(NYSE:MWA)
Rating:75Outperform
Price Target:
$28.00
▲(11.33%Upside)
Positive Factors
Earnings
Shares have responded to three consecutive quarters of positive earnings surprises.
Leadership
The company announced a CEO/CFO transition plan that signified a new chapter for MWA as it opened new facilities.
Negative Factors
Valuation
Shares recently traded at their highest valuation in over 10 years, making further re-rating potential less compared to other water peers.
Mueller Water Products (MWA) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.94B
Dividend Yield1.05%
Average Volume (3M)1.36M
Price to Earnings (P/E)27.5
Beta (1Y)1.16
Revenue Growth10.96%
EPS Growth43.44%
CountryUS
Employees3,400
SectorIndustrials
Sector Strength93
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)0.34
Shares Outstanding156,677,540
10 Day Avg. Volume1,576,592
30 Day Avg. Volume1,357,444
Financial Highlights & Ratios
PEG Ratio0.89
Price to Book (P/B)4.52
Price to Sales (P/S)0.00
P/FCF Ratio20.58
Enterprise Value/Market Cap1.04
Enterprise Value/Revenue0.77
Enterprise Value/Gross Profit8.66
Enterprise Value/Ebitda4.02
Forecast
1Y Price Target
$26.00Price Target Upside3.38% Upside
Rating ConsensusHold
Number of Analyst Covering2
Mueller Water Products Business Overview & Revenue Model
Company DescriptionMueller Water Products Inc. manufactures and markets products and services used in the transmission, distribution, and measurement of water in North America and internationally. Its products and services are used by municipalities, and the residential and non-residential construction industries. It operates through two segments, Infrastructure and Technologies. The company's Infrastructure segment manufactures and sells valves for water and gas systems, including iron gate, butterfly, tapping, check, knife, plug, automatic control, and ball valves; and dry-barrel and wet-barrel fire hydrants and service brass products, as well as a line of pipe repair products, such as clamps and couplings used to repair leaks. This segment offers its products under Canada Valve, Centurion, Ez-Max, Hydro Gate, Hydro-Guard, HYMAX, HYMAX VERSA, Jones, Krausz, Milliken, Mueller, Pratt, Pratt Industrial, Repamax, Repaflex, and Singer brands. Its Technologies segment offers residential and commercial water metering, water leak detection and pipe condition assessment products, systems, and services. It offers products under Echologics, Echoshore, ePulse, Hersey, LeakFinderRT, LeakFinderST, LeakListener, LeakTuner, Mi.Echo, Mi.Data, Mi.Hydrant, Mi.Net, Mueller Systems, and Sentryx brands. The company was founded in 1857 and is headquartered in Atlanta, Georgia.
How the Company Makes MoneyMueller Water Products generates revenue through the sale of its water infrastructure products and services. The company's key revenue streams include the manufacturing and distribution of water distribution products such as valves, hydrants, and pipe repair products. Additionally, the company earns income from its metering technology solutions, which include smart water metering systems and related software. Mueller Water Products also benefits from long-term contracts and relationships with municipalities and water utilities, which provide a steady source of income. Partnerships with local and regional distributors are essential in expanding the company's market reach and product accessibility, further contributing to its earnings.
Mueller Water Products Earnings Call Summary
Earnings Call Date:May 05, 2025
(Q2-2025)
| % Change Since: -6.75%|
Next Earnings Date:Aug 04, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a strong financial performance with record-breaking metrics in several areas. However, challenges such as the impact of newly enacted tariffs and manufacturing inefficiencies were notable. Despite these challenges, the company expressed confidence in its ability to mitigate negative impacts through pricing actions and operational initiatives. Overall, the highlights slightly outweigh the lowlights, reflecting a generally positive outlook with caution due to external factors.Q2-2025 Updates
Positive Updates
Record-Breaking Financial Performance
Achieved second quarter records for consolidated net sales, adjusted EBITDA, and adjusted net income per share. Net sales grew by 3.1% to $364.3 million, surpassing strong results from the prior year.
Strong Order Activity
Saw a strong sequential increase in order activity across most product lines, reflecting customer experience investments and resilient end market demand.
Increased Annual Guidance for Net Sales
Raised 2025 net sales guidance range to between $1.39 billion and $1.4 billion.
Successful Transition to New Brass Foundry
The new brass foundry is fully operational, expected to bring efficiencies and margin benefits in the second half of the year.
Negative Updates
Impact of Newly Enacted Tariffs
Approximately 15% of total cost of sales is exposed to newly enacted tariffs, with an estimated annualized impact of 8% to 9% of cost of sales.
Manufacturing Inefficiencies
Gross profit decreased by 1.8% compared with the prior year, with manufacturing inefficiencies expected as a result of the brass foundry transition.
Lower Volumes in Certain Product Lines
Experienced lower volumes of service brass and natural gas distribution products due to backlog normalization and customer destocking.
Company Guidance
In the second quarter of fiscal year 2025, Mueller Water Products achieved record metrics for consolidated net sales, adjusted EBITDA, and adjusted net income per share. Net sales experienced a growth of 3.1%, supported by healthy order levels and resilient market demand, reaching $364.3 million. Adjusted EBITDA increased by 2.8% to $84.5 million, while the adjusted EBITDA margin was 23.2%. Despite facing challenges such as newly enacted tariffs, the company maintained its adjusted EBITDA guidance range between $310 million and $315 million for the year. The company anticipates that the tariffs, impacting about 8% to 9% of the cost of sales, will start affecting results in the third quarter, with price mitigation actions expected to benefit in the fourth quarter. The company also increased its annual net sales guidance for 2025 to between $1.39 billion and $1.4 billion, reflecting confidence in continued strong demand, especially in the municipal markets, which account for 60% to 65% of net sales.Mueller Water Products Financial Statement Overview
Summary
Mueller Water Products displays a solid financial performance across all verticals. The income statement highlights strong growth and profitability, the balance sheet reflects financial stability, and the cash flow statement shows efficient cash management. While leverage is manageable, continued focus on further improving debt metrics could enhance financial flexibility.Income Statement
Mueller Water Products shows strong revenue growth with a consistent increase over recent years. TTM revenue has grown significantly from previous periods, indicating a positive trajectory. The company maintains a healthy gross profit margin and an improving net profit margin. EBIT and EBITDA margins are solid, reflecting effective cost management and operational efficiency.85
Very Positive
Balance Sheet
The balance sheet is robust with a favorable equity ratio, indicating a strong capital structure. The debt-to-equity ratio signifies manageable leverage levels, though there is room for improvement. The return on equity is commendable, reflecting good profitability relative to shareholder investment. Overall, the company demonstrates financial stability and prudent financial management.78
Positive
Cash Flow
Mueller Water Products exhibits healthy cash flow generation, with consistent free cash flow growth. The operating cash flow to net income and free cash flow to net income ratios are strong, indicating efficient cash conversion. The company effectively manages its capital expenditures, contributing to positive free cash flow.82
Very Positive
| Breakdown | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.31B | 1.28B | 1.25B | 1.11B | 964.10M |
| Gross Profit | 459.00M | 379.50M | 364.30M | 358.50M | 328.20M |
| EBITDA | 181.70M | 196.40M | 190.00M | 178.30M | 178.50M |
| Net Income | 115.90M | 85.50M | 76.60M | 70.40M | 72.00M |
Balance Sheet | |||||
| Total Assets | 1.64B | 1.50B | 1.50B | 1.52B | 1.40B |
| Cash, Cash Equivalents and Short-Term Investments | 309.90M | 160.30M | 146.50M | 227.50M | 208.90M |
| Total Debt | 477.50M | 472.10M | 473.70M | 446.90M | 474.90M |
| Total Liabilities | 825.80M | 793.50M | 828.80M | 823.10M | 754.30M |
| Stockholders Equity | 810.10M | 711.50M | 669.30M | 694.90M | 640.70M |
Cash Flow | |||||
| Free Cash Flow | 191.40M | 61.40M | -2.40M | 94.00M | 72.60M |
| Operating Cash Flow | 238.80M | 109.00M | 52.30M | 156.70M | 140.30M |
| Investing Cash Flow | -47.20M | -42.10M | -54.90M | -81.70M | -67.50M |
| Financing Cash Flow | -46.00M | -48.80M | -72.00M | -58.80M | -41.40M |
Mueller Water Products Technical Analysis
Positive
25.15
Price Trends
24.53
Positive
25.08
Positive
24.43
Positive
Market Momentum
0.12
Positive
56.08
Neutral
48.49
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MWA, the sentiment is Positive. The current price of 25.15 is above the 20-day moving average (MA) of 24.77, above the 50-day MA of 24.53, and above the 200-day MA of 24.43, indicating a bullish trend. The MACD of 0.12 indicates Positive momentum. The RSI at 56.08 is Neutral, neither overbought nor oversold. The STOCH value of 48.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MWA.
Mueller Water Products Risk Analysis
Mueller Water Products disclosed 42 risk factors in its most recent earnings report. Mueller Water Products reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Mueller Water Products Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $8.44B | 28.94 | 17.61% | 0.72% | 3.89% | 8.17% | |
77 Outperform | $934.80M | 17.90 | 11.03% | ― | 0.72% | 3.69% | |
75 Outperform | $3.94B | 27.48 | 17.68% | 1.05% | 10.96% | 43.44% | |
74 Outperform | $7.17B | 25.72 | 14.00% | 1.53% | 4.23% | 20.40% | |
73 Outperform | $4.24B | 24.28 | 14.11% | 1.11% | -1.26% | -4.84% | |
73 Outperform | $4.07B | 36.66 | 13.38% | 0.38% | 6.83% | -1.84% | |
58 Neutral | HK$14.89B | 4.75 | -2.78% | 5.07% | 3.80% | -54.55% |
* Industrials Sector Average
Performance Comparison
MWA
Mueller Water Products
25.15
4.73
23.16%
FLS
Flowserve
54.84
4.75
9.48%
FELE
Franklin Electric Co
92.89
-10.67
-10.30%
KAI
Kadant
345.38
-6.69
-1.90%
THR
Thermon Group Holdings
28.12
-4.20
-13.00%
WTS
Watts Water Technologies
252.78
50.16
24.76%
Mueller Water Products Corporate Events
Business Operations and StrategyFinancial Disclosures
Mueller Water Products Highlights Q2FY25 Financial Performance
Positive
May 7, 2025
Mueller Water Products released an updated investor presentation on May 7, 2025, highlighting its financial performance and strategic initiatives. The company reported $1,374 million in net sales for the last twelve months ending Q2FY25, with significant investments in operational excellence and customer experience to drive growth. The presentation also emphasized Mueller’s commitment to ESG initiatives, including a reduction in emissions intensity and increased use of recycled materials, which have been recognized with an upgraded ESG rating by MSCI.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.