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This Month's Featured News Why Institutions Keep Buying Badger Meter After the Big DropSubmitted by Thomas Hughes. Date Posted: 1/30/2026. 
Article Highlights- Badger Meter is set up to rebound robustly by year's end as growth underpins cash flow and capital returns.
- Institutions are accumulating this stock and are likely to accelerate activity with shares near long-term lows.
- Valuation and analyst forecasts suggest a 50% increase in the stock price is possible.
Valuation concerns capped gains for Badger Meter (NYSE: BMI) stock in 2025, and subsequent events pushed the market into a correction that now appears overextended and poised to rebound. Although valuation was a headwind, a roughly 40% decline in the share price has realigned expectations with company fundamentals — and the fundamentals look solid. Trading near long-term lows, the stock now trades at less than 20x its 2030 earnings, effectively pricing in sustained earnings growth and implying the potential for a roughly 50% price recovery over the coming quarters. Gold has weathered every financial disaster in history, and it's up more than 100 percent in the last two years. But there's another reason to pay attention now. Since 1950, roughly 70 percent of all the gold on earth has already been mined. What remains is harder to find and more costly to extract. Supplies are running out at the exact moment the world needs gold to stabilize heavily indebted financial systems. A four-stock portfolio of top gold developers is now available, selling at an average 82 percent discount to asset value. Get the four picks plus a bonus stock with potential for significant upside. 
Badger Meter's long-term guidance, reaffirmed in the Q4 2025 earnings release, calls for sustained high-single-digit revenue growth, annualized margin expansion, and strong free cash flow conversion. That combination is expected to drive a mid-teens compound annual growth rate for earnings and cash flow, with the company forecasting free cash flow conversion above 100%. Badger Meter: Free Cash Flow, Capital Returns, and Accumulating InstitutionsThe free cash flow conversion metric is central to the investment case. As a profitable mid-cap, Badger Meter is expanding cash flow through revenue leverage and operational improvements, and it has the capacity to return capital to shareholders. Capital returns are not outsized but are consistent and are expected to grow. Dividends are running near 30% of the 2026 earnings forecast, the balance sheet is conservative, and share repurchases are being used to manage the share count. Buybacks have been sufficient to offset share-based compensation and keep diluted share counts declining — one of several reasons long-term investors may want exposure. Institutional activity further underscores the value on offer in this profitable, dividend-paying, mid-cap growth story. Institutions own roughly 90% of the float. On balance they were buyers every quarter in 2025, stepped up purchases late in the year, and have continued that bullish trend into early 2026. That steady accumulation provides a solid support base and helps underpin a positive price outlook for the coming quarters. The Q4 release may not have triggered a retail buying surge, but it did not weaken the capital return outlook — if anything, it reinforced it. Given institutional trends, further accumulation is likely. Badger Meter Falls After Mixed ResultsBadger Meter reported a solid quarter: revenue rose 7.6% to just over $220 million, but this narrowly missed consensus estimates and left the market less than enthused. Offsetting the revenue miss were strengths with utility customers and continued adoption of smart-water technologies, both of which should support growth going forward. The company expanded operating margin by nearly 50 basis points, producing a healthy bottom-line result despite softer top-line momentum. GAAP earnings increased by 10% versus 7.6% revenue growth and outperformed consensus by a notable margin, enabling balance sheet improvement alongside higher R&D, CapEx, and capital returns. Badger Meter's balance sheet shows no red flags and offers incentives for ownership. The company recorded a slight decline in cash and current assets, which was offset by higher total assets and lower liabilities. The net effect was an approximate 17.5% increase in shareholder equity and persistently low leverage. Management funds R&D and acquisitions with operating cash flow and on-hand cash, the company carries no debt, and total liabilities are roughly 0.35x equity.
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