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Will Top-Line Growth Buoy Badger Meter's (BMI) Q2 Earnings?

Zacks Equity Research

Badger Meter, Inc. BMI is scheduled to release second-quarter 2019 results before the opening bell on Jul 18. The company is likely to record relatively higher revenues on a year-over-year basis.

Whether this will benefit the bottom line of the company remains to be seen.

Top-Line Expansion

Badger Meter is poised to gain from growing demand for E-Series meters and ORION Cellular endpoints as well as BEACON Advanced Metering Analytics managed solution. During the second quarter, the company inked an agreement to supply its next-generation ORION Cellular smart water communication endpoints to Aurora Water in Colorado. The state-of-the-art products will enable the city to reduce water loss, promote conservation and improve water delivery for the utility’s nearly 87,000 customers. Badger Meter’s BEACON software-as-a-service offering would also facilitate the administration to collect and analyze data within the distribution network to improve operational awareness.

Further, Badger Meter is continuously prioritizing and enhancing its presence in select regional markets outside the United States that offer healthy growth potential. During second-quarter 2019, the company launched a slew of innovative products to strengthen its leading position in the market. These include the E-Series ultrasonic meters for residential applications. With smart alarms, pressure and temperature data, the product offers early detection of any anomaly in the system, thereby lowering maintenance and operating costs for utility firms.

Increased traction of such innovative solutions is likely to translate into higher revenues. The Zacks Consensus Estimate for second-quarter revenues is currently pegged at $117 million, up from $114 million recorded a year ago.

Earnings Whispers

Our proven model does not show that Badger Meter is likely to beat earnings this quarter as it does not possess the key components. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here as you will see below:

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00% as both are pegged at 47 cents. Notably, the consensus estimate for second-quarter earnings indicates growth of 11.9% from the year-ago reported figure. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Badger Meter, Inc. Price and EPS Surprise

 

Badger Meter, Inc. Price and EPS Surprise

Badger Meter, Inc. price-eps-surprise | Badger Meter, Inc. Quote

Zacks Rank: Badger Meter carries a Zacks Rank #4 (Sell).

Note that we caution against stocks with a Zacks Rank #4 or 5 (Strong Sell) going into the earnings announcement, especially when the company is seeing a negative estimate revisions momentum.
   
Stocks to Consider

Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter:

AT&T, Inc. T is slated to release quarterly numbers on Jul 24. It has an Earnings ESP of +0.46% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Verizon Communications, Inc. VZ is scheduled to release results on Aug 1. The company has an Earnings ESP of +0.55% and has a Zacks Rank #2.

The Earnings ESP for United States Cellular Corporation USM is +15.66% and it sports a Zacks Rank of 1. The company is set to report quarterly numbers on Aug 2.

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