Badger Meter (NYSE:BMI) versus Methode Electronics (NYSE:MEI) Financial Survey

Methode Electronics (NYSE:MEI) and Badger Meter (NYSE:BMI) are both technology companies, but which is the better business? We will compare the two companies based on the strength of their profitability, valuation, dividends, earnings, analyst recommendations, institutional ownership and risk.

Volatility & Risk

Methode Electronics has a beta of 1.57, indicating that its stock price is 57% more volatile than the S&P 500. Comparatively, Badger Meter has a beta of 0.64, indicating that its stock price is 36% less volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Methode Electronics	-3.52%	-5.63%	-2.94%
Badger Meter	14.36%	18.49%	13.02%

Insider and Institutional Ownership

95.5% of Methode Electronics shares are owned by institutional investors. Comparatively, 89.0% of Badger Meter shares are owned by institutional investors. 1.9% of Methode Electronics shares are owned by company insiders. Comparatively, 1.0% of Badger Meter shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Methode Electronics and Badger Meter”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Methode Electronics	$1.02 billion	0.43	-$35.70 million	($1.04)	-11.90
Badger Meter	$916.66 million	4.90	$141.63 million	$4.33	35.80

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

Analyst Recommendations

This is a breakdown of current recommendations for Methode Electronics and Badger Meter, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Methode Electronics	1	3	2	0	2.17
Badger Meter	1	5	6	0	2.42

Methode Electronics currently has a consensus price target of $22.00, suggesting a potential upside of 77.71%. Badger Meter has a consensus price target of $165.88, suggesting a potential upside of 7.00%. Given Methode Electronics’ higher probable upside, research analysts clearly believe Methode Electronics is more favorable than Badger Meter.

Dividends

Methode Electronics pays an annual dividend of $0.20 per share and has a dividend yield of 1.6%. Badger Meter pays an annual dividend of $1.76 per share and has a dividend yield of 1.1%. Methode Electronics pays out -19.2% of its earnings in the form of a dividend. Badger Meter pays out 40.6% 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. Badger Meter has increased its dividend for 32 consecutive years. Methode Electronics is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

Badger Meter beats Methode Electronics on 10 of the 17 factors compared between the two stocks.

About Methode Electronics

Methode Electronics, Inc. designs, engineers, and produces mechatronic products worldwide. It operates through four segments: Automotive, Industrial, Interface, and Medical. The Automotive segment supplies electronic and electro-mechanical devices, and related products to automobile original equipment manufacturers directly or through their tiered suppliers. Its products include integrated center consoles, hidden and ergonomic switches, transmission lead-frames, complex insert molded solutions, LED-based lighting solutions, and sensors, which incorporate magneto-elastic sensing, eddy current, or other sensing technologies that monitor the operation or status of a component or system. The Industrial segment manufactures external lighting solutions comprising driving, work, and signal lights; industrial safety radio remote controls; braided flexible cables; current-carrying laminated and powder-coated busbars; high-voltage high current connector and contracts; custom power-product assemblies, such as PowerRail solution; and high-current low-voltage flexible power cabling systems that are used in aerospace, cloud computing, commercial vehicles, construction equipment, industrial, military, power conversion, and transportation markets and applications. The Interface segment provides various copper-based transceivers and related accessories for the cloud computing hardware equipment and telecommunications broadband equipment markets; user interface solutions for the appliance, commercial food service, and point-of-sale equipment markets; and fluid-level sensors for the marine/recreational vehicle and sump pump markets. The Medical segment offers Dabir Surfaces, a surface support technology aimed at pressure injury prevention for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. Methode Electronics, Inc. was incorporated in 1946 and is headquartered in Chicago, Illinois.

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.