MWA - Mueller Water Lagging As Investors Turn Away From A Once-Hot Sector

• Mueller's operating results have been exceeding expectations, but the company is seeing input cost pressures and the Street has cooled on many water-driven industrials.
• Infrastructure spending on water projects may not help Mueller as much as some companies, but overall, higher spending on water infrastructure should drive more demand for its portfolio of valves.
• Demand for tech-based offerings like leak detection and condition monitoring is a key unknown; stimulus spending could finally help these long-disappointing units reach critical mass.
• Mueller looks modestly undervalued now, but margin pressure will likely remain a little while longer, and the sentiment is no longer a tailwind.

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