BMI
Badger Meter, Inc.
$125.84
Platform & Compounding FCF
85%
Two-stage FCF DCF
Moderate
·
Conviction
Fair Value
Trading 16.9% below fair value
You pay
$125.84
Bear
$108.64
Fair
$151.35
Bull
$195.33
Bear
$108.64
-13.7%
7% stage 1 growth, 11% discount
Fair
$151.35
+20.3%
12% stage 1 growth, 11% discount
Bull
$195.33
+55.2%
15% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (12% base case)
Terminal Value % of EV
40%
Implied Market Multiple
21.2x
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $167.29 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $151.35 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions