New York Stock Exchange (NYSE) · Industrials
Mueller Industries, Inc. MLI
InterestingScore band: 70–80
The thesis, in one sentence
A quality net-cash business with strong returns on equity, but the multiple has doubled against its own historical median for a free cash flow that has been flat for four years, and this year's revenue growth is copper prices and acquisitions rather than volume.
Written for this site in plain English, without figures. The arithmetic is in the full report.
The thesis is from the deep report of 2026-08-24; the verdict badge reflects the latest scoring of 2026-09-06.
Key risks
- Free cash flow has been flat for four years while the shares re-rated
- Revenue growth is copper price and acquisitions, not core volume
- Tariff protection is treated as a temporary rent, not a permanent spread
What would change the verdict
- Free cash flow yield rises to a level that justifies the multiple
- Gross margin recovers, showing the copper spread is structural
- Operating margin expands enough to justify the growth premium
- Return on equity falls, undermining the quality case
Read it yourself
Step five of the method is the reader's: open the latest annual or quarterly report and read it before acting on anything here. A score is a summary, and a summary is not understanding.
Next report expected 2026-10-20. The deep report was written against the filings available on 2026-08-24; anything published since is not in it.
Price, one year
Where the money goes
Last four reported quarters, 2025-09 → 2026-06, in USD. Filings data as gathered on 2026-08-24. Figures rounded to three significant digits.
Open this week — scorecard, figures and executive summary
This ticker's exact score, its 30-criterion scorecard with the evidence behind each score, the DCF and Monte Carlo figures and the report's executive summary are open to everyone this week, no email required. The chapters after the summary are not — the demo ticker shows what a complete report looks like.
| Score | 70.8% (weighted sum out of 60 points) |
|---|---|
| DCF (min / base / max) | -45% / -33% / 10% |
| P(undervalued) | 19.5% (20,000 simulations) |
| p5 | p10 | p25 | p50 | p75 | p90 | p95 |
|---|---|---|---|---|---|---|
| -50.5% | -45.5% | -35.7% | -22.2% | -5.6% | 13.4% | 26.4% |
Percentiles, as a percentage margin against the reference price.
scenarios below today's pricescenarios above today's pricetoday's pricerange of the DCF modelsbase case
Scorecard — all 30 criteria
| # | Framework | Criterion | Evidence | Score |
|---|---|---|---|---|
| 1 | Graham | Current earnings multiple, against its own sectorpriced in the cheapest tier of its own sector | P/E TTM 16.47 vs the Metal Fabrication sector (weighted average ~38-46x, inflated by outliers; exact percentile uncertain with only 2 verified comparables) — treated conservatively as the 30-50 percentile zone | 0.5 |
| 2 | Graham | Price to book — or cash generation, for intangible-heavy sectorsbook multiple low by the standards of its sector; for technology, semiconductors, pharma and e-commerce a high free-cash-flow yield replaces it, because book value means little there | 63.22 / 14.44 = 4.38x (>2.5x) | 0 |
| 3 | Graham | Earnings multiple times book multiplethe combined earnings-and-book multiple below a Graham-style ceiling | 16.47 × 4.38 = 72.1 (>50) | 0 |
| 4 | Graham | Dividend actually paida dividend paid without interruption over the last five years | Yes, rising, 5+ consecutive years (from $0.0325/quarter in 2021 to $0.175/quarter in 2026) | 1 |
| 5 | Graham | Dividend yielda dividend yield well above what the average listed company pays | 1.11% (<1.5%) | 0 |
| 6 | Graham | Leveragedebt below equity, or a net cash position; for banks and insurers this is judged on regulatory capital instead | D/E ≈ 0.01; cash $1.37bn vs total debt $27.5mil — net cash position | 1 |
| 7 | Graham | Return on invested capital against the cost of that capitalreturns on invested capital clearly above what the capital costs; not computable for financials, which is why their denominator differs | ROIC FY2025 37.1% (>20%) | 1 |
| 8 | Graham | Earnings growth over five yearsearnings per share higher than they were five years ago | $2.06 (FY2021) → $3.84 TTM — clear growth | 1 |
| 9 | Graham | Consistency of profitprofitable in every one of the last five years | Net profit positive in each of the last 5 years (2021-2025) | 1 |
| 10 | Graham | Price against the Graham Numberprice below the Graham Number computed from earnings and book value | GN = √(22.5×3.84×14.44) = 35.32 USD; price 63.22 > GN+10% (38.85) | 0 |
| 11 | Buffett | A durable moata competitive advantage that is clear and defensible — brand, network, switching cost, licence or cost position | The only vertically integrated producer of copper and brass pipes/fittings in North America; the 50% tariff on imported semi-finished goods reinforces the domestic advantage | 1 |
| 12 | Buffett | How long the moat lastsan advantage that should still be standing a decade from now | Scale and vertical integration seem durable for 5-10 years, but there is a long-term structural risk from copper pipe → PEX substitution in plumbing | 0.5 |
| 13 | Buffett | Return on equity, sustaineda high return on equity held for years without leaning on debt, measured after one-off gains are normalised away | ROE 2023-2025: 29.2% / 23.9% / 25.6%, with no significant leverage (D/E~0.01) | 1 |
| 14 | Buffett | Margins against the sectornet or operating margins above the sector average, by a clear gap | Net margin 18.3% FY2025, clearly above the metal fabrication sector average | 1 |
| 15 | Buffett | Quality of managementa management team with a long track record of allocating capital well | Long track record, disciplined allocation (the Bison Metals 2026 acquisition, selective buybacks, rapidly rising dividend) | 1 |
| 16 | Buffett | Skin in the gamemanagement owns a meaningful part of the company and is not selling | Insider ownership only 2.02% (<5%) | 0.5 |
| 17 | Buffett | Predictabilitya business simple enough that next year can be reasoned about | Demand tied to construction/HVAC/plumbing and the copper spread — moderate predictability, not high | 0.5 |
| 18 | Buffett | Retained earnings put to workevery unit of profit kept in the business creates more than a unit of value | Strong FCF ($687mil FY2025), reinvested into acquisitions (Bison) and buybacks, ROIC well above cost of capital | 1 |
| 19 | Buffett | Pricing powerable to pass inflation on to customers without losing them | Demonstrated pass-through of copper cost into price; now benefiting from tariff protection | 1 |
| 20 | Buffett | Margin of safety against the valuation modelsprice meaningfully below where the triangulated models put intrinsic value; for banks the dividend discount model is used, never analyst consensus | No formal DCF (reserved for the deep analysis); price near the 52-week high ($71.12), analyst target $80 but thin coverage (2 analysts) — mixed signal, no clear margin of safety | 0.5 |
| 21 | Lynch | Growth against the multiple paid for itthe multiple paid is small relative to the growth rate bought | 1.18 (>1) | 0 |
| 22 | Lynch | Rate of profit growthearnings per share compounding fast over the last three years, after one-off and cyclical gains are normalised away | EPS CAGR ~3 years (FY2022→TTM): ~9.7%, at the edge of the 10% threshold | 0.5 |
| 23 | Lynch | Fits a Lynch categoryclearly a fast grower, a stalwart or an asset play — not an ambiguous cyclical or a risky turnaround | Mixed: industrial stalwart with a recent cyclical upswing (tariffs + HVAC demand) — not a pure Fast Grower | 0.5 |
| 24 | Lynch | An unfashionable corner of the marketin a business or a sector nobody is excited about | Only 2 analysts cover the stock | 1 |
| 25 | Lynch | A story that can be told simplythe investment case can be explained in a couple of minutes, without jargon | Producer of copper and brass pipes/fittings — explainable in 2 minutes | 1 |
| 26 | Lynch | Insider ownershipfounders or insiders hold a large stake and have been buying, not selling | 2.02%, with no clear signal of recent management purchases | 0 |
| 27 | Lynch | A solid balance sheetnet cash, or debt far below equity | Net cash, D/E ~0.01 | 1 |
| 28 | Lynch | Market sharetaking share from competitors rather than merely defending it | Gaining domestic share through tariff protection and the Bison Metals acquisition (added capacity) | 1 |
| 29 | Lynch | Analyst coveragefollowed by few institutional analysts, if any | 2 analysts | 1 |
| 30 | Lynch | Dilution from share-based payshare-based compensation consumes only a marginal slice of revenue each year | $26.76mil SBC / $4.18bn revenue = 0.64% (<1%) | 1 |
Subtotals
| Graham | 5.5 |
|---|---|
| Buffett | 8 |
| Lynch | 7 |
| Total (30) | 20.5 |
| Score | 70.8% / 60 |
Executive summary, with figures
Mueller Industries, Inc. (NYSE: MLI) — deep-value analysis
Analysis date: August 24, 2026 · Reference price: $63.22 · Market cap: $13.98 bn · EV: $12.62 bn · Shares: 221.18 mil. (post 2:1 split from 06/30/2026)
Primary sources: 10-K filed 02/25/2026 (fiscal year ended 12/27/2025), 10-Qs filed 04/22/2026 (Q1 2026) and 07/22/2026 (Q2 2026), DEF 14A from 03/26/2026, Form 4s from July–August 2026, 8-Ks from 07/21/2026 and 08/10/2026. Market data: yfinance, 08/24/2026. The 08/24/2026 research brief was used only as a starting point — its deviations from the filings are explicitly flagged in the text.
Executive summary
The thesis. Mueller Industries is a genuinely good business — probably one of the best-run mid-cap industrials in the US — valued at a price that leaves no room for anything to go wrong. The company makes copper tube and fittings, brass rod, aluminum extrusions and HVAC/R components, with $4.66 bn of revenue over the last 12 months and $1.02 bn of adjusted operating profit. The balance sheet is net-cash, with $1.41 bn of cash and short-term investments against $5.2 mil. of debt (assumed with the Bison acquisition), return on equity 26.3%, and operating cash flow has covered dividends and buybacks twice over in each of the last five years. Management does exactly the right things: buying back aggressively at $39.7/share (Q1 2025), moderately at $57.7 (Q1 2026) and not at all at $63–71 (Q2 2026); buying niche businesses at reasonable multiples; selling what doesn't fit (Sherwood, $57.0 mil., $41.4 mil. gain).
What doesn't work in the thesis at this price. Three things, all from the filings, none from opinion:
- Free cash flow has been flat for four years. CFO − capex: $686.3 mil. (2022), $618.7 mil. (2023), $565.7 mil. (2024), $686.6 mil. (2025). Zero cumulative growth over four fiscal years, while the stock has gone up 7.2x (the total-return index from Item 5 of the 10-K: 100 at end-2020 → 723.74 at end-2025).
- 2026's revenue growth is copper price, not volume. In Q2 2026 sales rose 25.5%, of which $184.6 mil. was higher selling price (average COMEX copper $6.16/lb, +30.6%) and $62.5 mil. was Bison; core volume added only $17.4 mil. Gross margin fell from 31.0% to 27.7%, and reported operating profit grew 1.9%. Adjusted for the $36.3 mil. insurance gain in Q2 2025, operating profit grew 16.0% — real, but below revenue growth.
- The multiple re-rating has done almost all the work on returns. Year-end P/E, split-adjusted: 7.2x (2021), 5.1x (2022), 8.9x (2023), 14.9x (2024), 16.7x (2025), 16.5x today. EPS has doubled in five years ($2.06 → $3.84 adjusted); the multiple has tripled. Today's buyer pays twice the historical median for a business whose core volume is shrinking.
Estimated value. Five triangulated models give a range from −45% to +10% versus the current price, with the median at −33%. The central DCF (owner earnings $630 mil., g1 5%, r 9.5%, gt 1.5%, net cash $1.3 bn) gives $49.02/share, i.e. −22.5%. The Monte Carlo simulation across 20,000 scenarios over the same assumptions gives a median of −22.2% and a 19.5% probability the stock is undervalued. The intrinsic-value range spans roughly $35–70.
Verdict: AVOID at $63.22. A watchlist company, not a buy. This isn't a short position — the balance sheet is too strong, management too good, and the optionality on redeploying the $1.4 bn of cash too real. It's a company worth watching for the $42–48 zone (the median of the triangulation down to the percentile where the simulation turns positive), which would correspond to a multiple of ~12x adjusted profit or a copper-price correction back to a mid-cycle multiple. The divergence from the tracker's GBL score (21.25/30) is small and explainable: the tracker measures the business's quality, and the business is high quality. What the deep analysis adds is that the price has already priced in that quality, plus a few years of growth volume doesn't support.
That is chapter one of the deep report, figures included. Chapters two onwards stay closed for the five open tickers. See what a complete analysis looks like — this week's demo ticker: SNT Energy Co., Ltd. (100840) →
Full report contents
- Executive summary
- 🔒 The business and the moat (Available in the full report)
- 🔒 Management and capital allocation (Available in the full report)
- 🔒 What changed over the last 4 quarters (Available in the full report)
- 🔒 Balance sheet analysis — Quality of Earnings (Thornton O'Glove method) (Available in the full report)
- 🔒 CEO profile — Outsider traits (William Thorndike method) (Available in the full report)
- 🔒 Accounting red flags (Available in the full report)
- 🔒 Triangulated valuation (Available in the full report)
- 🔒 Pre-mortem (Available in the full report)
- 🔒 Verdict compared with the tracker's GBL score (Available in the full report)
See what a complete analysis looks like — this week's demo ticker: SNT Energy Co., Ltd. (100840) →
Evaluation history
| Date | Verdict |
|---|---|
| 2026-08-23 | Interesting |
| 2026-09-06 | Interesting |
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The scorecard, the valuation figures and the executive summary are open to everyone this week; the remaining chapters are not. Subscribers get one full deep report a week by email, the day before it opens here — and the weekly list of what cleared the filters.