Badger Meter Shares Decline on Quarterly Revenue Shortfall

Shares of Badger Meter faced significant selling pressure in extended trading after the company reported fourth-quarter revenue that fell short of Wall Street's projections. This quarterly disappointment cast a shadow over what was otherwise a record-setting fiscal year 2025 for the water technology firm, with the stock hitting a new intraday 52-week low.

Despite the end-of-year stumble, Badger Meter closed fiscal 2025 with record total revenue of $916.7 million, marking an 11% year-over-year increase. Full-year earnings per share (EPS) reached $4.79, a 13% gain. This strong annual performance was fueled by two primary factors: the acquisition of SmartCover, which contributed approximately $40 million to the top line, and substantial growth in the company's SaaS (Software-as-a-Service) segment. SaaS revenue climbed roughly 27% to about $74 million.

A Closer Look at Q4 2025

For the three-month period ending December 31, 2025, the company generated sales of $220.7 million. While this represents an 8% improvement compared to the same quarter in the prior year, it notably missed the consensus estimate among analysts, which ranged between $232 million and $234.4 million. Quarterly profit came in at $33.6 million, translating to EPS of $1.14, up from $1.04 a year earlier. The market's focus, however, remained fixed on the revenue miss, which drove the negative price action.

Should investors sell immediately? Or is it worth buying Badger Meter?

Forward Guidance and Dividend

Looking ahead, management has provided an outlook for 2026, forecasting revenue growth in the high single-digit percentage range. Achieving this target will likely depend on whether continued expansion in SaaS income and the ongoing integration of the SmartCover business can offset the slower momentum witnessed in the final quarter of 2025. The trajectory of these two segments is expected to be a key influence on the stock's performance in coming quarters.

In separate news, the company's board declared a regular quarterly cash dividend of $0.40 per share.

Key Financial Highlights:
* Q4 2025 Revenue: $220.7 million (up 8% YoY, below estimates)
* Q4 2025 EPS: $1.14; Net Income: $33.6 million
* FY 2025 Revenue: $916.7 million (Record, +11% YoY)
* FY 2025 EPS: $4.79 (+13% YoY)
* Primary Growth Drivers: SmartCover acquisition (~$40M revenue), SaaS growth (~27% to ~$74M)
* Dividend: Quarterly payout of $0.40 per share declared
* 2026 Outlook: High single-digit percentage revenue growth anticipated