5-Star Stocks Poised to Pop: Mueller Water

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Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, water infrastructure specialist Mueller Water Products (NYS: MWA) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Mueller's business and see what CAPS investors are saying about the stock right now.

Mueller facts

HeadquartersAtlanta
Market Cap$381 million
IndustryIndustrial machinery
Trailing-12-Month Revenue$1.31 billion
Management

Chairman/CEO Gregory Hyland (since 2007)

CFO Evan Hart (since 2008)

Return on Capital (Average, Past 3 Years)1.3%
Cash/Debt$45.8 million / $693 million
Dividend Yield2.9%
CompetitorsTyco International (NYS: TYC)

Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.

On CAPS, 97% of the 1,507 members who have rated Mueller believe the stock will outperform the S&P 500 going forward. These bulls include JohnnySp and raulnj48.   

Just last month, JohnnySp touched on the trends working in Mueller's favor:

Water infrastructure is bound to take off as communities and governments look to update crumbling systems. Plus, stands to gain from the inevitable recovery in construction industry. Sports a nice dividend too!

Currently, Mueller even sports a particularly paltry EV/EBITDA of 3.6. That represents a clear discount to other industrial plays like Tyco (6.6), General Electric (NYS: GE) (19.1), and United Technologies (NYS: UTX) (7.3).

CAPS member raulnj48 elaborates on the bargain opportunity:

This stock regularly traded for $14 plus before the financial crisis in 2008. There is an enormous amount of water treatment and distribution infrastructure that needs to be upgraded in this country, and that will be a big opportunity for MWA. While many are concerned that budget issues at many municipalities might continue to postpone or cancel water infrastructure projects, sooner or later most of them will have to happen to maintain water quality and system efficiency. When MWA starts reporting growth and profits, the stock is likely to see strong appreciation from these levels.

What do you think about Mueller Water, or any other stock for that matter? If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future, and on Motley Fool CAPS, thousands of investors are working every day to find them. CAPS is 100% free, so get started!

Interested in another easy way to trackMueller?Add it to your watchlist.

At the time this article was published Fool contributor Brian Pacampara owns no position in any of the companies mentioned. The Motley Fool owns shares of Mueller. Try any of our Foolish newsletter services free for 30 days.We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

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