Mesa Laboratories (NASDAQ: MLAB) and Badger Meter (NYSE:BMI) are both small-cap medical companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, earnings, dividends, analyst recommendations and profitabiliy.
Dividends
Mesa Laboratories pays an annual dividend of $0.64 per share and has a dividend yield of 0.4%. Badger Meter pays an annual dividend of $0.46 per share and has a dividend yield of 1.0%. Mesa Laboratories pays out 22.0% of its earnings in the form of a dividend. Badger Meter pays out 39.3% 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 raised its dividend for 15 consecutive years. Badger Meter is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Analyst Ratings
This is a summary of recent recommendations for Mesa Laboratories and Badger Meter, as provided by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Mesa Laboratories | 0 | 0 | 1 | 0 | 3.00 |
| Badger Meter | 0 | 2 | 1 | 0 | 2.33 |
Badger Meter has a consensus price target of $44.50, indicating a potential downside of 1.66%. Given Badger Meter’s higher probable upside, analysts clearly believe Badger Meter is more favorable than Mesa Laboratories.
Insider & Institutional Ownership
66.9% of Mesa Laboratories shares are owned by institutional investors. Comparatively, 84.3% of Badger Meter shares are owned by institutional investors. 17.0% of Mesa Laboratories shares are owned by insiders. Comparatively, 4.5% of Badger Meter shares are owned by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Profitability
This table compares Mesa Laboratories and Badger Meter’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Mesa Laboratories | 11.94% | 17.67% | 9.74% |
| Badger Meter | 8.67% | 13.19% | 9.52% |
Risk and Volatility
Mesa Laboratories has a beta of 0.46, indicating that its share price is 54% less volatile than the S&P 500. Comparatively, Badger Meter has a beta of 0.54, indicating that its share price is 46% less volatile than the S&P 500.
Earnings and Valuation
This table compares Mesa Laboratories and Badger Meter’s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | EBITDA | Earnings Per Share | Price/Earnings Ratio | |
| Mesa Laboratories | $93.67 million | 5.77 | $25.82 million | $2.91 | 49.67 |
| Badger Meter | $395.15 million | 3.33 | $77.75 million | $1.17 | 38.68 |
Badger Meter has higher revenue and earnings than Mesa Laboratories. Badger Meter is trading at a lower price-to-earnings ratio than Mesa Laboratories, indicating that it is currently the more affordable of the two stocks.
Summary
Mesa Laboratories beats Badger Meter on 9 of the 16 factors compared between the two stocks.
About Mesa Laboratories
Mesa Laboratories, Inc. is focused primarily on quality control products and services. The Company operates through four segments: Instruments, Continuous Monitoring, Biological Indicators and Cold Chain. The Instruments Division designs, manufactures and markets quality control instruments and disposable products. Its Biological Indicators Division provides testing services, along with the manufacturing and marketing of biological indicators and distribution of chemical indicators used to assess the effectiveness of sterilization processes. Its Continuous Monitoring Division designs, develops and markets systems, which are used to monitor various environmental parameters. Its Cold Chain Division provides parameter (primarily temperature) monitoring of products in a cold chain. The Company’s brands include DataTrace, DialyGuard, DryCal, Torqo, SureTorque, BGI, Mesa, PCD, Apex, CheckPoint, Mesa and TempTrust.
About Badger Meter
Badger Meter, Inc. is a manufacturer and marketer of products incorporating flow measurement, control and communication solutions, serving water utilities, municipalities, and commercial and industrial customers around the world. The Company’s products measure water, oil, chemicals and other fluids, provide and communicate timely measurement data. Its product lines include two categories: sales of water meters and related technologies to municipal water utilities (municipal water), and sales of meters to various industries for water and other fluids (flow instrumentation). The municipal water offering includes mechanical and ultrasonic (electronic) water meters and related technologies and services used by water utilities as the basis for generating water and wastewater. The flow instrumentation category includes the sale of meters and valves around the world to measure and control materials flowing through a pipe or pipeline, including air, steam, oil, and other liquids and gases.
Receive News & Ratings for Mesa Laboratories Inc. Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Mesa Laboratories Inc. and related companies with MarketBeat.com's FREE daily email newsletter.
