Mueller Water Products, Inc. (NYSE: MWA)

Sector: Industrials Industry: Specialty Industrial Machinery CIK: 0001350593
Market Cap 4.67 Bn
P/B 4.58
P/E 23.37
P/S 3.23
ROIC (Qtr) 14.41
Div Yield % 0.90
Rev 1y % (Qtr) 4.57
Total Debt (Qtr) 452.30 Mn
Debt/Equity (Qtr) 0.44
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About

Mueller Water Products, Inc. (MWA) is a prominent player in the water infrastructure industry, specializing in the manufacturing and marketing of products and services used in the transmission, distribution, and measurement of water in North America. The company operates through two segments: Water Flow Solutions and Water Management Solutions. Water Flow Solutions is the company's largest segment, accounting for approximately half of Mueller Water Products' consolidated net sales in 2023. This segment focuses on the production and sale of iron...

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Investment thesis

Bull case

  • Strong operating cash flow of 226.40M provides robust 0.50x coverage of total debt 452.30M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 459.60M provide 328.29x coverage of short-term debt 1.40M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 226.40M provides strong 19.35x coverage of stock compensation 11.70M, indicating sustainable incentive practices.
  • Strong tangible asset base of 1.45B provides 3.20x coverage of total debt 452.30M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 174.10M exceeds capital expenditure of 52.30M by 3.33x, indicating strong organic growth funding capability.

Bear case

  • Operating cash flow of 226.40M barely covers its investment activities of (52.30M), with a coverage ratio of -4.33, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 226.40M provides thin coverage of dividend payments of (42.30M) with a -5.35 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Free cash flow of 174.10M represents just -124.36x of debt issuance (1.40M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • Operating cash flow of 226.40M is outpaced by equity issuance of (16.70M) (-13.56 ratio), indicating concerning reliance on equity markets for funding operations.
  • Retained earnings of (131M) provide limited buffer against comprehensive income items of 4.50M, which is -29.11x, indicating elevated exposure to market risks.

Segments Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Specialty Industrial Machinery
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GEV GE Vernova Inc. 224.93 Bn 194.57 6.14 0.00 Bn
2 ETN Eaton Corp plc 153.13 Bn 38.99 5.75 11.22 Bn
3 PH Parker-Hannifin Corp 135.87 Bn 165.29 12.09 9.87 Bn
4 EMR Emerson Electric Co 111.68 Bn 47.10 4.65 13.41 Bn
5 ITW Illinois Tool Works Inc 86.68 Bn 28.27 5.40 8.97 Bn
6 CMI Cummins Inc 82.13 Bn 28.89 2.44 7.55 Bn
7 AME Ametek Inc/ 53.79 Bn 36.34 7.27 2.28 Bn
8 ROK Rockwell Automation, Inc 43.80 Bn 44.24 5.11 3.68 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 2.54 2.28
EV to Cash from Ops. EV/CFO 20.69 37.14
EV to Debt EV to Debt 10.36 34.39
EV to EBIT EV/EBIT 17.35 27.71
EV to EBITDA EV/EBITDA 14.75 25.34
EV to Free Cash Flow [EV/FCF] EV/FCF 26.91 133.36
EV to Market Cap EV to Market Cap 1.00 1.04
EV to Revenue EV/Rev 3.25 39.88
Price to Book Value [P/B] P/B 4.58 6.22
Price to Earnings [P/E] P/E 23.37 143.63
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 4.72 2.57
Dividend Payout Ratio % Div Payout % (Qtr) 21.20 15.73
Dividend per Basic Share Div per Share (Qtr) 0.27 0.91
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 24.60 82.53
Interest Coverage Int. cover (Qtr) 45.02 12.34
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 2.24 -45.99
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 35.90 118.48
Dividend Growth (1y) % Div 1y % (Qtr) 5.79 10.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 41.04 -283.03
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 18.72 -36.87
EBIT Growth (1y) % EBIT 1y % (Qtr) 32.86 -80.72
EBT Growth (1y) % EBT 1y % (Qtr) 37.34 -120.93
EPS Growth (1y) % EPS 1y % (Qtr) 48.28 -39.22
FCF Growth (1y) % FCF 1y % (Qtr) 1.52 85.55
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 12.15 0.87
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.78 0.62
Cash Payout Ratio Cash Payout (Qtr) 0.15 0.10
Cash Ratio Cash Ratio (Qtr) 1.80 3.01
Current Ratio Curr Ratio (Qtr) 4.02 4.97
Debt to Equity Ratio Debt/Equity (Qtr) 0.44 0.38
Interest Cover Ratio Int Coverage (Qtr) 45.02 12.34
Times Interest Earned Times Interest Earned (Qtr) 45.02 12.34
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 22.00 -7,291.27
EBIT Margin % EBIT Margin % (Qtr) 18.71 -7,413.30
EBT Margin % EBT Margin % (Qtr) 18.29 -9,015.79
Gross Margin % Gross Margin % (Qtr) 37.00 -32.61
Net Profit Margin % Net Margin % (Qtr) 13.80 -7,962.06