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. Both the health and profitability get an excellent rating, making MWA a very profitable company, without any liquidiy or solvency issues. MWA has a correct valuation and a medium growth rate. These ratings would make MWA suitable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year MWA was profitable.
MWA had a positive operating cash flow in the past year.
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
With a decent Return On Assets value of 8.61%, MWA is doing good in the industry, outperforming 75.00% of the companies in the same industry.
MWA has a better Return On Equity (16.47%) than 74.22% of its industry peers.
MWA has a Return On Invested Capital of 12.61%. This is in the better half of the industry: MWA outperforms 77.34% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MWA is in line with the industry average of 10.71%.
The 3 year average ROIC (9.01%) for MWA is below the current ROIC(12.61%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.61% | ||
| ROE | 16.47% | ||
| ROIC | 12.61% |
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
MWA has a Profit Margin of 10.48%. This is in the better half of the industry: MWA outperforms 70.31% of its industry peers.
In the last couple of years the Profit Margin of MWA has grown nicely.
MWA has a Operating Margin of 17.65%. This is amongst the best in the industry. MWA outperforms 82.03% of its industry peers.
In the last couple of years the Operating Margin of MWA has grown nicely.
The Gross Margin of MWA (34.70%) is better than 60.16% of its industry peers.
MWA's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.65% | ||
| PM (TTM) | 10.48% | ||
| GM | 34.7% |
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so MWA is still creating some value.
Compared to 1 year ago, MWA has more shares outstanding
Compared to 5 years ago, MWA has less shares outstanding
Compared to 1 year ago, MWA has an improved debt to assets ratio.
2.2 Solvency
MWA has an Altman-Z score of 4.46. This indicates that MWA is financially healthy and has little risk of bankruptcy at the moment.
MWA's Altman-Z score of 4.46 is fine compared to the rest of the industry. MWA outperforms 71.88% of its industry peers.
MWA has a debt to FCF ratio of 2.34. This is a good value and a sign of high solvency as MWA would need 2.34 years to pay back of all of its debts.
MWA's Debt to FCF ratio of 2.34 is fine compared to the rest of the industry. MWA outperforms 75.00% of its industry peers.
MWA has a Debt/Equity ratio of 0.51. This is a neutral value indicating MWA is somewhat dependend on debt financing.
MWA has a Debt to Equity ratio of 0.51. This is comparable to the rest of the industry: MWA outperforms 42.97% of its industry peers.
Even though the debt/equity ratio score it not favorable for MWA, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.51 | ||
| Debt/FCF | 2.34 | ||
| Altman-Z | 4.46 |
ROIC/WACC1.33
WACC9.46%
2.3 Liquidity
MWA has a Current Ratio of 3.79. This indicates that MWA is financially healthy and has no problem in meeting its short term obligations.
MWA has a better Current ratio (3.79) than 85.94% of its industry peers.
MWA has a Quick Ratio of 2.49. This indicates that MWA is financially healthy and has no problem in meeting its short term obligations.
Looking at the Quick ratio, with a value of 2.49, MWA belongs to the top of the industry, outperforming 82.03% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.79 | ||
| Quick Ratio | 2.49 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 41.25% over the past year.
The Earnings Per Share has been growing by 9.36% on average over the past years. This is quite good.
MWA shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.96%.
The Revenue has been growing slightly by 6.31% on average over the past years.
EPS 1Y (TTM)41.25%
EPS 3Y20.82%
EPS 5Y9.36%
EPS Q2Q%13.33%
Revenue 1Y (TTM)10.96%
Revenue growth 3Y5.77%
Revenue growth 5Y6.31%
Sales Q2Q%3.08%
3.2 Future
MWA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.98% yearly.
The Revenue is expected to grow by 5.37% on average over the next years.
EPS Next Y28.59%
EPS Next 2Y18.63%
EPS Next 3Y12.98%
EPS Next 5YN/A
Revenue Next Year8.31%
Revenue Next 2Y6.66%
Revenue Next 3Y5.37%
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.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 21.94, the valuation of MWA can be described as rather expensive.
Based on the Price/Earnings ratio, MWA is valued a bit cheaper than the industry average as 60.16% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.45. MWA is valued slightly cheaper when compared to this.
MWA is valuated rather expensively with a Price/Forward Earnings ratio of 18.16.
62.50% of the companies in the same industry are more expensive than MWA, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of MWA to the average of the S&P500 Index (21.90), we can say MWA is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.94 | ||
| Fwd PE | 18.16 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as MWA.
65.63% of the companies in the same industry are more expensive than MWA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.2 | ||
| EV/EBITDA | 13.44 |
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.
MWA's earnings are expected to grow with 12.98% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.77
PEG (5Y)2.34
EPS Next 2Y18.63%
EPS Next 3Y12.98%
5. Dividend
5.1 Amount
MWA has a Yearly Dividend Yield of 1.08%.
MWA's Dividend Yield is a higher than the industry average which is at 1.87.
With a Dividend Yield of 1.08, MWA pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
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 their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)4.69%
Div Incr Years10
Div Non Decr Years18
5.3 Sustainability
28.42% 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.
DP28.42%
EPS Next 2Y18.63%
EPS Next 3Y12.98%
24.79
+0.14 (+0.57%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners104.59%
Inst Owner Change12%
Ins Owners0.83%
Ins Owner Change-1.59%
Market Cap3.88B
Analysts74
Price Target28.73 (15.89%)
Short Float %3.24%
Short Ratio3.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.08% |
Yearly Dividend0.26
Dividend Growth(5Y)4.69%
DP28.42%
Div Incr Years10
Div Non Decr Years18
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)18.31%
Min EPS beat(2)8.59%
Max EPS beat(2)28.03%
EPS beat(4)4
Avg EPS beat(4)20.22%
Min EPS beat(4)1.31%
Max EPS beat(4)42.93%
EPS beat(8)7
Avg EPS beat(8)34.42%
EPS beat(12)8
Avg EPS beat(12)24.99%
EPS beat(16)11
Avg EPS beat(16)21.06%
Revenue beat(2)2
Avg Revenue beat(2)3.1%
Min Revenue beat(2)2.38%
Max Revenue beat(2)3.82%
Revenue beat(4)4
Avg Revenue beat(4)4.88%
Min Revenue beat(4)2.38%
Max Revenue beat(4)7.15%
Revenue beat(8)7
Avg Revenue beat(8)4.29%
Revenue beat(12)9
Avg Revenue beat(12)3.63%
Revenue beat(16)12
Avg Revenue beat(16)4.27%
PT rev (1m)-1.74%
PT rev (3m)-3.43%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-5.61%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)1.23%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-0.28%
Revenue NY rev (1m)0.28%
Revenue NY rev (3m)0.93%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.94 | ||
| Fwd PE | 18.16 | ||
| P/S | 2.83 | ||
| P/FCF | 20.2 | ||
| P/OCF | 15.85 | ||
| P/B | 4.45 | ||
| P/tB | 7.99 | ||
| EV/EBITDA | 13.44 |
EPS(TTM)1.13
EY4.56%
EPS(NY)1.37
Fwd EY5.51%
FCF(TTM)1.23
FCFY4.95%
OCF(TTM)1.56
OCFY6.31%
SpS8.77
BVpS5.58
TBVpS3.1
PEG (NY)0.77
PEG (5Y)2.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.61% | ||
| ROE | 16.47% | ||
| ROCE | 16.89% | ||
| ROIC | 12.61% | ||
| ROICexc | 16.37% | ||
| ROICexgc | 25.19% | ||
| OM | 17.65% | ||
| PM (TTM) | 10.48% | ||
| GM | 34.7% | ||
| FCFM | 14% |
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-Score8
Asset Turnover0.82
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.51 | ||
| Debt/FCF | 2.34 | ||
| Debt/EBITDA | 1.51 | ||
| Cap/Depr | 94.61% | ||
| Cap/Sales | 3.84% | ||
| Interest Coverage | 34.63 | ||
| Cash Conversion | 82.19% | ||
| Profit Quality | 133.63% | ||
| Current Ratio | 3.79 | ||
| Quick Ratio | 2.49 | ||
| Altman-Z | 4.46 |
F-Score8
WACC9.46%
ROIC/WACC1.33
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)41.25%
EPS 3Y20.82%
EPS 5Y9.36%
EPS Q2Q%13.33%
EPS Next Y28.59%
EPS Next 2Y18.63%
EPS Next 3Y12.98%
EPS Next 5YN/A
Revenue 1Y (TTM)10.96%
Revenue growth 3Y5.77%
Revenue growth 5Y6.31%
Sales Q2Q%3.08%
Revenue Next Year8.31%
Revenue Next 2Y6.66%
Revenue Next 3Y5.37%
Revenue Next 5YN/A
EBIT growth 1Y42.76%
EBIT growth 3Y15.24%
EBIT growth 5Y9.12%
EBIT Next Year51.65%
EBIT Next 3Y19.48%
EBIT Next 5YN/A
FCF growth 1Y1066.33%
FCF growth 3Y26.75%
FCF growth 5Y100.55%
OCF growth 1Y736.18%
OCF growth 3Y15.08%
OCF growth 5Y20.89%