Dealmaker’s Diary: Why This “Boring” Stock with a 32-Year Dividend Streak Could Dominate the Next Decade

Alpesh Patel|June 5, 2025

This week’s “Stock of the Week” isn’t flashy.

It doesn’t have a celebrity CEO or viral TikTok moments.

What it does have are numbers so excellent they made me do a double-take…

A 32-year dividend growth streak… profit margins that keep expanding… and one metric I’ve don’t think I’ve seen this high in my decades of analysis.

This $7.34 billion company operates in a sector most investors overlook, yet it’s positioned at the center of what many consider the next global resource crisis.

As water scarcity becomes a worldwide concern and infrastructure demands smart solutions, this company isn’t just riding the wave – it’s creating it.

The question isn’t whether water technology will be essential in the coming decades. The question is whether you’ll own a piece of the company that’s already dominating this space.

Click on the image below to see why this under-the-radar winner deserves your attention.

TRANSCRIPT

Hi, friends, and welcome to another Dealmaker’s Diary stock of the week.

You’re going to like this one – I say this every time, but I got really excited about this one because it has one metric that’s so good I’ve never seen it this high before.

The company is Badger Meter (NYSE: BMI).

And I’ll admit to you, it’s not one I’ve come across before, even though it is a $7.34 billion company.

But the numbers speak for themselves. I’ll come to those numbers in a second.

They say the next war is going to be about water.

Badger Meter provides advanced technologies for flow measurement, water quality monitoring, and control systems. As you can imagine, that’s important stuff.

They also have the global aspect to consider.

Growth numbers are good.

Profit growth: 22%.

Revenue growth: phenomenal.

Profits are growing quicker than revenue, which suggests profit margins are increasing – the ability to have pricing power, which is always good.

It has a 32-year streak of dividend increases.

How did that miss the radar?

How come that was in stealth mode all this time?

AI Integration Analysis

So let’s look at the numbers.

Before we do, I really enjoy this part every week, we look at what’s happening in the world of AI for that company.

I think it’s an opportunity for us to learn and also to double-check: are they keeping up with what is actually changing the world?

• AI-driven smart water management: Badger Meter leverages AI-powered analytics. Well, I’d expect them to use analytics – AI and analytics.
• Flow optimization: Again, using AI for that.
• Predictive asset monitoring: Sensors to work out, basically, how well the machinery and the infrastructure is holding up. Yeah, I’d expect them to use AI for that.
• Water quality monitoring: Of course. I mean, I’d expect it only after I’ve read about it and think, “Oh, yeah. That makes sense.”
• Customer analytics and demand forecasting: Of course.
• Operational efficiency: Yep.

What’s important here is that they’re doing this. If they weren’t, that’d be a bit of a red flag and worrying. If we couldn’t list at least six things that they’re doing using AI in their business, then I’d be worried.

The Numbers

Here they are for Badger Meter:

My proprietary Value Growth Income rating: 7. Anything above seven or seven and higher meets my minimum criteria.

Forecast P/E: Expensive. That’s probably the highest I’ve ever seen of any number, and that’s not necessarily a good thing. It’s expensive. You’re paying $50 for every dollar of profit. That worries me, and it is the highest I’ve ever seen.

CROCI (Cash Return on Capital Invested): They’re getting a lot of cash generated for the capital they’re investing. Spend your capital once, get a cash cow thereafter. That’s what it measures.

Sortino ratio above 1: That is probably one of the highest numbers, if not the highest I’ve ever seen. What that means is massive returns, low volatility to the downside. And you can see that volatility overall is only 10%. That might be one of the lowest volatilities I’ve ever seen in a stock.

So, a lot of “wow.” It’s impressive.

That’s why we have to use data and not narratives.

Technical Analysis & Outlook

The thing that I will say – I don’t want to rain on your parade – but what I will say is that momentum and average prices just keep going up and up and up.

Usually, it would dip off, but it’s not happening. I mean, it had that dive, which was a great opportunity to buy, but that’s all hindsight now.

This looks like a V-shaped recovery, and that’s the obvious place and direction I’ve got to say it’s going to go in.

It’s one of those where, if it falls, buy on the dip, because that just works as a strategy. You may need to extend your time frame. You might have to buy it on the dip and hold through it.

Discount cash flow: Overvalued. I apologize. You can’t have everything in life.

Hope you like it overall, though.

Thank you very much.