Critical Review: Badger Meter (BMI) and BTU International (BTUI)

Badger Meter (NYSE: BMI) and BTU International (NASDAQ:BTUI) are both small-cap computer and technology companies, but which is the better business? We will compare the two businesses based on the strength of their risk, earnings, profitability, dividends, valuation, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and recommmendations for Badger Meter and BTU International, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Badger Meter 0 4 1 0 2.20
BTU International 0 0 0 0 N/A

Badger Meter presently has a consensus target price of $48.00, indicating a potential upside of 9.71%. Given Badger Meter’s higher probable upside, equities research analysts clearly believe Badger Meter is more favorable than BTU International.

Risk and Volatility

Badger Meter has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500. Comparatively, BTU International has a beta of 1.34, meaning that its share price is 34% more volatile than the S&P 500.

Earnings & Valuation

This table compares Badger Meter and BTU International’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Badger Meter $393.76 million 3.23 $32.29 million $1.14 38.38
BTU International N/A N/A N/A ($0.44) -5.95

Badger Meter has higher revenue and earnings than BTU International. BTU International is trading at a lower price-to-earnings ratio than Badger Meter, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

83.9% of Badger Meter shares are held by institutional investors. 4.5% of Badger Meter shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Dividends

Badger Meter pays an annual dividend of $0.52 per share and has a dividend yield of 1.2%. BTU International does not pay a dividend. Badger Meter pays out 45.6% of its earnings in the form of a dividend. Badger Meter has increased its dividend for 15 consecutive years.

Profitability

This table compares Badger Meter and BTU International’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Badger Meter 8.39% 12.62% 9.11%
BTU International N/A N/A N/A

Summary

Badger Meter beats BTU International on 11 of the 13 factors compared between the two stocks.

About Badger Meter

Badger Meter, Inc. is a manufacturer and marketer of products incorporating flow measurement, control and communication solutions, serving water utilities, municipalities, and commercial and industrial customers around the world. The Company’s products measure water, oil, chemicals and other fluids, provide and communicate timely measurement data. Its product lines include two categories: sales of water meters and related technologies to municipal water utilities (municipal water), and sales of meters to various industries for water and other fluids (flow instrumentation). The municipal water offering includes mechanical and ultrasonic (electronic) water meters and related technologies and services used by water utilities as the basis for generating water and wastewater. The flow instrumentation category includes the sale of meters and valves around the world to measure and control materials flowing through a pipe or pipeline, including air, steam, oil, and other liquids and gases.

About BTU International

BTU International, Inc. (BTU) is engaged in designing, manufacturing, selling and servicing of thermal processing equipment and related process controls for use in the electronics, alternative energy, automotive and other industries. The Company operates as a single business segment called Thermal Processing Capital Equipment. It is engaged in the supply of solder reflow systems used for surface mount applications in printed circuit board assembly. The Company’s thermal processing equipment is used in low temperature curing/encapsulation, hybrid integrated circuit manufacturing, integrated circuit packaging and sealing, and processing multi-chip modules. In addition, the equipment is used for solar cell processing, sintering nuclear fuel for commercial power generation, as well as brazing and the sintering of ceramics and powdered metals. Its alternative energy business addresses two markets, the manufacturing of solar cells and nuclear fuels.

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