Comparing Badger Meter (NYSE:BMI) and AMETEK (NYSE:AME)

AMETEK (NYSE:AME) and Badger Meter (NYSE:BMI) are both technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, risk, analyst recommendations, profitability, valuation and dividends.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
AMETEK	20.04%	16.93%	11.26%
Badger Meter	14.27%	18.03%	12.82%

Institutional & Insider Ownership

87.4% of AMETEK shares are owned by institutional investors. Comparatively, 89.0% of Badger Meter shares are owned by institutional investors. 0.5% of AMETEK shares are owned by insiders. Comparatively, 1.0% of Badger Meter shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Dividends

AMETEK pays an annual dividend of $1.36 per share and has a dividend yield of 0.6%. Badger Meter pays an annual dividend of $1.60 per share and has a dividend yield of 1.2%. AMETEK pays out 19.9% of its earnings in the form of a dividend. Badger Meter pays out 37.4% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. AMETEK has raised its dividend for 6 consecutive years and Badger Meter has raised its dividend for 32 consecutive years. Badger Meter is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of recent recommendations and price targets for AMETEK and Badger Meter, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
AMETEK	0	5	10	1	2.75
Badger Meter	1	5	5	0	2.36

AMETEK currently has a consensus price target of $266.80, suggesting a potential upside of 10.32%. Badger Meter has a consensus price target of $164.00, suggesting a potential upside of 19.85%. Given Badger Meter’s higher possible upside, analysts plainly believe Badger Meter is more favorable than AMETEK.

Earnings & Valuation

This table compares AMETEK and Badger Meter”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
AMETEK	$7.40 billion	7.49	$1.48 billion	$6.84	35.36
Badger Meter	$916.66 million	4.33	$141.63 million	$4.28	31.97

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

Volatility & Risk

AMETEK has a beta of 0.98, suggesting that its stock price is 2% less volatile than the S&P 500. Comparatively, Badger Meter has a beta of 0.65, suggesting that its stock price is 35% less volatile than the S&P 500.

Summary

AMETEK beats Badger Meter on 11 of the 18 factors compared between the two stocks.

About AMETEK

AMETEK, Inc. manufactures and sells electronic instruments and electromechanical devices in the North America, Europe, Asia, and South America, and internationally. The company's EIG segment offers advanced instruments for the process, aerospace, power, and industrial markets; process and analytical instruments for the oil and gas, petrochemical, pharmaceutical, semiconductor, automation, and food and beverage industries; instruments to the laboratory equipment, ultra-precision manufacturing, medical, and test and measurement markets; power quality monitoring and c devices, uninterruptible power supplies, programmable power and electromagnetic compatibility test equipment, and sensors for gas turbines and dashboard instruments; heavy trucks, instrumentation, and controls for the food and beverage industries; and aircraft and engine sensors, power supplies, embedded computing, monitoring, fuel and fluid measurement, and data acquisition systems for aerospace and defense industry. Its EMG segment offers engineered medical components and devices, automation solutions, thermal management systems, specialty metals, and electrical interconnects; single-use and consumable surgical instruments, implantable components, and drug delivery systems; engineered electrical connectors and electronics packaging to protect sensitive devices and mission-critical electronics; precision motion control products for data storage, medical devices, business equipment, and automation; high-purity powdered metals, strips and foils, specialty clad metals, and metal matrix composites; motor-blower systems and heat exchangers for thermal management, military and commercial aircraft, and military ground vehicles; motors for commercial appliances, food and beverage machines, hydraulic pumps, and industrial blowers; and operates a network of aviation maintenance, repair, and overhaul facilities. AMETEK, Inc. was incorporated in 1930 and is headquartered in Berwyn, Pennsylvania.

About Badger Meter

Badger Meter, Inc. manufactures and markets flow measurement, quality, control, and communication solutions worldwide. It offers mechanical or static water meters, and related radio and software technologies and services to municipal water utilities market. The company also provides flow instrumentation products, including meters, valves, and other sensing instruments to measure and control fluids going through a pipe or pipeline, including water, air, steam, and other liquids and gases to original equipment manufacturers as the primary flow measurement device within a product or system, as well as through manufacturers' representatives. In addition, the company offers ORION Cellular endpoints to power network as a service; ORION mobile read endpoints support for deploying AMR solution; radio products; hardware, instruments, and sensors, and related software, to enhance connected data to a water utility's operation; water quality monitoring solutions, including optical sensing and electrochemical instruments; and high frequency pressure and leak detection sensors to aid in burst pipe and leak events; as well as BEACON, a secure cloud-hosted software suite that establishes alerts for specific conditions and allows consumer engagement tools that permit end water customers to view and manage their water usage activity. Its flow instrumentation products are used in water/wastewater, heating, ventilating and air conditioning, and corporate sustainability markets. The company serves water utilities, commercial, and industrial industries; and provides training, project management, technical support, and other collaborative services for customers. It sells its products and software directly, as well as through resellers and representatives. The company was incorporated in 1905 and is based in Milwaukee, Wisconsin.