Water infrastructure products manufacturer Mueller Water Products reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 4.6% year on year to $318.2 million. The company’s full-year revenue guidance of $1.48 billion at the midpoint came in 0.8% above analysts’ estimates. Its non-GAAP profit of $0.29 per share was 10.1% above analysts’ consensus estimates.

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“We are pleased with the great start to our fiscal year, with solid net sales growth and year-over-year adjusted EBITDA margin expansion. Our continued focus on delivering outstanding customer service and operational excellence, along with resilient end-market demand, led to first-quarter records for net sales, adjusted EBITDA and adjusted EBITDA margin,” said Martie Edmunds Zakas, Chief Executive Officer of Mueller Water Products.

Company Overview

As one of the oldest companies in the water infrastructure industry, Mueller (NYSE: MWA) is a provider of water infrastructure products and flow control systems for various sectors.

Revenue Growth

A company’s long-term sales performance is one signal of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul. Over the last five years, Mueller Water Products grew its sales at a decent 7.9% compounded annual growth rate. Its growth was slightly above the average industrials company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Mueller Water Products’s annualized revenue growth of 8.9% over the last two years is above its five-year trend, suggesting some bright spots.

This quarter, Mueller Water Products reported modest year-on-year revenue growth of 4.6% but beat Wall Street’s estimates by 2%.

Looking ahead, sell-side analysts expect revenue to grow 2.3% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and indicates its products and services will see some demand headwinds. At least the company is tracking well in other measures of financial health.

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Operating Margin

Mueller Water Products has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 13%.

Analyzing the trend in its profitability, Mueller Water Products’s operating margin rose by 7.1 percentage points over the last five years, as its sales growth gave it immense operating leverage.

In Q4, Mueller Water Products generated an operating margin profit margin of 17.8%, up 2.2 percentage points year on year. Since its gross margin expanded more than its operating margin, we can infer that leverage on its cost of sales was the primary driver behind the recently higher efficiency.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Mueller Water Products’s EPS grew at an astounding 20.1% compounded annual growth rate over the last five years, higher than its 7.9% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into Mueller Water Products’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, Mueller Water Products’s operating margin expanded by 7.1 percentage points over the last five years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Mueller Water Products, its two-year annual EPS growth of 45.2% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q4, Mueller Water Products reported adjusted EPS of $0.29, up from $0.25 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Mueller Water Products’s full-year EPS of $1.35 to grow 7.3%.

Key Takeaways from Mueller Water Products’s Q4 Results

It was great to see Mueller Water Products’s full-year EBITDA guidance top analysts’ expectations. We were also glad its EBITDA outperformed Wall Street’s estimates. Zooming out, we think this was a solid print. The stock remained flat at $27.73 immediately following the results.

Mueller Water Products may have had a good quarter, but does that mean you should invest right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).