MUELLER WATER PRODUCTS INC-A (MWA) Stock Fundamental Analysis
NYSE:MWA - New York Stock Exchange, Inc. - US6247581084 - Common Stock - Currency: USD
Taking everything into account, MWA scores 7 out of 10 in our fundamental rating. MWA was compared to 128 industry peers in the Machinery industry. MWA has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. MWA has a correct valuation and a medium growth rate. These ratings could make MWA a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
In the past year MWA was profitable.
In the past year MWA had a positive cash flow from operations.
In the past 5 years MWA has always been profitable.
MWA had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 8.45%, MWA is in the better half of the industry, outperforming 75.78% of the companies in the same industry.
MWA has a better Return On Equity (16.41%) than 75.78% of its industry peers.
The Return On Invested Capital of MWA (12.64%) is better than 78.13% of its industry peers.
The Average Return On Invested Capital over the past 3 years for MWA is in line with the industry average of 10.67%.
The 3 year average ROIC (9.01%) for MWA is below the current ROIC(12.64%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.45% | ||
| ROE | 16.41% | ||
| ROIC | 12.64% |
ROA(3y)5.96%
ROA(5y)5.54%
ROE(3y)12.59%
ROE(5y)11.83%
ROIC(3y)9.01%
ROIC(5y)8.58%
1.3 Margins
With a decent Profit Margin value of 10.05%, MWA is doing good in the industry, outperforming 67.97% of the companies in the same industry.
In the last couple of years the Profit Margin of MWA has grown nicely.
Looking at the Operating Margin, with a value of 17.38%, MWA belongs to the top of the industry, outperforming 82.03% of the companies in the same industry.
MWA's Operating Margin has improved in the last couple of years.
MWA has a better Gross Margin (35.15%) than 62.50% of its industry peers.
MWA's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.38% | ||
| PM (TTM) | 10.05% | ||
| GM | 35.15% |
OM growth 3Y8.95%
OM growth 5Y2.64%
PM growth 3Y11.63%
PM growth 5Y5.99%
GM growth 3Y2.66%
GM growth 5Y1.04%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), MWA is creating some value.
Compared to 1 year ago, MWA has more shares outstanding
Compared to 5 years ago, MWA has less shares outstanding
The debt/assets ratio for MWA has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.49 indicates that MWA is not in any danger for bankruptcy at the moment.
MWA's Altman-Z score of 4.49 is fine compared to the rest of the industry. MWA outperforms 75.78% of its industry peers.
MWA has a debt to FCF ratio of 2.62. This is a good value and a sign of high solvency as MWA would need 2.62 years to pay back of all of its debts.
The Debt to FCF ratio of MWA (2.62) is better than 68.75% of its industry peers.
MWA has a Debt/Equity ratio of 0.54. This is a neutral value indicating MWA is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.54, MWA is in line with its industry, outperforming 42.19% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.62 | ||
| Altman-Z | 4.49 |
ROIC/WACC1.3
WACC9.76%
2.3 Liquidity
A Current Ratio of 3.83 indicates that MWA has no problem at all paying its short term obligations.
With an excellent Current ratio value of 3.83, MWA belongs to the best of the industry, outperforming 85.94% of the companies in the same industry.
MWA has a Quick Ratio of 2.38. This indicates that MWA is financially healthy and has no problem in meeting its short term obligations.
The Quick ratio of MWA (2.38) is better than 80.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.83 | ||
| Quick Ratio | 2.38 |
3. Growth
3.1 Past
MWA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 70.31%, which is quite impressive.
MWA shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.36% yearly.
MWA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 11.94%.
Measured over the past years, MWA shows a small growth in Revenue. The Revenue has been growing by 6.31% on average per year.
EPS 1Y (TTM)70.31%
EPS 3Y20.82%
EPS 5Y9.36%
EPS Q2Q%92.31%
Revenue 1Y (TTM)11.94%
Revenue growth 3Y5.77%
Revenue growth 5Y6.31%
Sales Q2Q%18.68%
3.2 Future
The Earnings Per Share is expected to grow by 14.72% on average over the next years. This is quite good.
MWA is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.56% yearly.
EPS Next Y27.03%
EPS Next 2Y18.49%
EPS Next 3Y14.72%
EPS Next 5YN/A
Revenue Next Year7.31%
Revenue Next 2Y6.41%
Revenue Next 3Y5.56%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.95, MWA is valued on the expensive side.
Based on the Price/Earnings ratio, MWA is valued a bit more expensive than the industry average as 60.94% of the companies are valued more cheaply.
MWA is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.29, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 18.37 indicates a rather expensive valuation of MWA.
60.94% of the companies in the same industry are more expensive than MWA, based on the Price/Forward Earnings ratio.
MWA is valuated at similar levels of the S&P average when we compare the Price/Forward Earnings ratio to 21.08, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.95 | ||
| Fwd PE | 18.37 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as MWA.
MWA's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.86 | ||
| EV/EBITDA | 13.54 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of MWA may justify a higher PE ratio.
A more expensive valuation may be justified as MWA's earnings are expected to grow with 14.72% in the coming years.
PEG (NY)0.85
PEG (5Y)2.45
EPS Next 2Y18.49%
EPS Next 3Y14.72%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.11%, MWA has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.12, MWA has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.57, MWA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
5.2 History
The dividend of MWA has a limited annual growth rate of 4.69%.
MWA has paid a dividend for at least 10 years, which is a reliable track record.
MWA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)4.69%
Div Incr Years10
Div Non Decr Years18
5.3 Sustainability
29.51% of the earnings are spent on dividend by MWA. This is a low number and sustainable payout ratio.
The dividend of MWA is growing, but earnings are growing more, so the dividend growth is sustainable.
DP29.51%
EPS Next 2Y18.49%
EPS Next 3Y14.72%
25.02
-0.04 (-0.16%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners96.09%
Inst Owner Change0%
Ins Owners0.84%
Ins Owner Change-0.64%
Market Cap3.92B
Analysts74
Price Target29.75 (18.9%)
Short Float %1.68%
Short Ratio1.59
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.11% |
Yearly Dividend0.26
Dividend Growth(5Y)4.69%
DP29.51%
Div Incr Years10
Div Non Decr Years18
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)14.67%
Min EPS beat(2)1.31%
Max EPS beat(2)28.03%
EPS beat(4)4
Avg EPS beat(4)44.28%
Min EPS beat(4)1.31%
Max EPS beat(4)104.85%
EPS beat(8)6
Avg EPS beat(8)32.04%
EPS beat(12)8
Avg EPS beat(12)24.75%
EPS beat(16)11
Avg EPS beat(16)21.26%
Revenue beat(2)2
Avg Revenue beat(2)4.99%
Min Revenue beat(2)3.82%
Max Revenue beat(2)6.15%
Revenue beat(4)4
Avg Revenue beat(4)8.48%
Min Revenue beat(4)3.82%
Max Revenue beat(4)16.78%
Revenue beat(8)6
Avg Revenue beat(8)3.88%
Revenue beat(12)9
Avg Revenue beat(12)3.87%
Revenue beat(16)12
Avg Revenue beat(16)4.56%
PT rev (1m)0%
PT rev (3m)10.76%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.53%
EPS NY rev (1m)0%
EPS NY rev (3m)5.48%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.75%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.9%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.95 | ||
| Fwd PE | 18.37 | ||
| P/S | 2.88 | ||
| P/FCF | 22.86 | ||
| P/OCF | 17.41 | ||
| P/B | 4.7 | ||
| P/tB | 8.81 | ||
| EV/EBITDA | 13.54 |
EPS(TTM)1.09
EY4.36%
EPS(NY)1.36
Fwd EY5.44%
FCF(TTM)1.09
FCFY4.37%
OCF(TTM)1.44
OCFY5.74%
SpS8.7
BVpS5.33
TBVpS2.84
PEG (NY)0.85
PEG (5Y)2.45
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.45% | ||
| ROE | 16.41% | ||
| ROCE | 16.93% | ||
| ROIC | 12.64% | ||
| ROICexc | 16.67% | ||
| ROICexgc | 26.35% | ||
| OM | 17.38% | ||
| PM (TTM) | 10.05% | ||
| GM | 35.15% | ||
| FCFM | 12.58% |
ROA(3y)5.96%
ROA(5y)5.54%
ROE(3y)12.59%
ROE(5y)11.83%
ROIC(3y)9.01%
ROIC(5y)8.58%
ROICexc(3y)10.84%
ROICexc(5y)10.33%
ROICexgc(3y)17.57%
ROICexgc(5y)17.96%
ROCE(3y)12.07%
ROCE(5y)11.49%
ROICexcg growth 3Y8.33%
ROICexcg growth 5Y0.66%
ROICexc growth 3Y15.33%
ROICexc growth 5Y7.3%
OM growth 3Y8.95%
OM growth 5Y2.64%
PM growth 3Y11.63%
PM growth 5Y5.99%
GM growth 3Y2.66%
GM growth 5Y1.04%
F-Score9
Asset Turnover0.84
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.54 | ||
| Debt/FCF | 2.62 | ||
| Debt/EBITDA | 1.51 | ||
| Cap/Depr | 88.01% | ||
| Cap/Sales | 3.93% | ||
| Interest Coverage | 28.88 | ||
| Cash Conversion | 75.58% | ||
| Profit Quality | 125.2% | ||
| Current Ratio | 3.83 | ||
| Quick Ratio | 2.38 | ||
| Altman-Z | 4.49 |
F-Score9
WACC9.76%
ROIC/WACC1.3
Cap/Depr(3y)79.39%
Cap/Depr(5y)92.1%
Cap/Sales(3y)3.91%
Cap/Sales(5y)4.88%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)70.31%
EPS 3Y20.82%
EPS 5Y9.36%
EPS Q2Q%92.31%
EPS Next Y27.03%
EPS Next 2Y18.49%
EPS Next 3Y14.72%
EPS Next 5YN/A
Revenue 1Y (TTM)11.94%
Revenue growth 3Y5.77%
Revenue growth 5Y6.31%
Sales Q2Q%18.68%
Revenue Next Year7.31%
Revenue Next 2Y6.41%
Revenue Next 3Y5.56%
Revenue Next 5YN/A
EBIT growth 1Y73.23%
EBIT growth 3Y15.24%
EBIT growth 5Y9.12%
EBIT Next Year51.55%
EBIT Next 3Y20.9%
EBIT Next 5YN/A
FCF growth 1Y721.01%
FCF growth 3Y26.75%
FCF growth 5Y100.55%
OCF growth 1Y765.39%
OCF growth 3Y15.08%
OCF growth 5Y20.89%