Badger Meter lifts dividend 10% as operating margin improves in third quarter

Badger Meter raised its dividend 10% after squeezing more profit from flat third-quarter sales.

Diluted EPS rose 4% to $1.24 from $1.19, according to the earnings release the water-metering company filed with an 8-K on Thursday. Total sales were $235.9 million, compared with $235.7 million a year earlier, and rose 6% from the second quarter.

The annual dividend rate rises to $1.76 a share, the company's 34th consecutive year of dividend growth.

"Consistent with our expectations, third quarter sales reflected the ongoing ramp of awarded utility water projects as well as solid underlying demand trends," Chairman, President and CEO Kenneth C. Bockhorst said in the release.

Margins expand

Operating earnings increased 4% to $47.7 million, and the operating margin widened 60 basis points to 20.2%. Gross margin improved to 41.9% from 40.7%, which the company credited to higher sales and mix benefits.

Utility water sales were flat, including $5.6 million from the UDlive acquisition. Excluding the deal, utility water sales rose 5% from the second quarter but fell 3% year over year, which the company tied to uneven pacing of advanced metering projects, partly offset by higher software revenue. Flow instrumentation sales rose 2%.

Badger Meter repurchased about $55 million of its shares during the quarter.

By the numbers

• Sales: $235.9 million, up 6% sequentially
• Diluted EPS: $1.24, up 4%
• Operating margin: 20.2%
• Annual dividend rate: $1.76, up 10%
• Q3 buybacks: about $55 million

Sources

1. Badger Meter, Inc., Form 8-K (Item 2.02) with Exhibit 99.1 earnings release dated Oct. 22, 2026, accession 0001193125-26-428396

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