Why Mueller Industries Stock Flopped in February

February wasn't a memorable month for many stocks on U.S. exchanges, and we can confidently assume Mueller Industries (NYSE: MLI) is happy it's now in the past. The company's shares lost more than 13% of their value over the period, on the back of a quarterly earnings miss. Even a monster dividend raise couldn't reverse the decline.

A mixed final quarter of 2025

Mueller, a veteran industrial company that manufactures and sells metal and plastic components for a range of segments including refrigeration and heating, ventilation, and air conditioning (HVAC), published its final earnings release for 2025 at the start of February.

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The good news is that both net sales and net income in accordance with generally accepted accounting principles (GAAP) rose year over year. The top line expanded by more than 4% to over $962 million, easily exceeding the $962 million consensus among the few analysts tracking Mueller stock.

The less-good news is that, while GAAP profitability saw a steeper (11%) rise to nearly $154 million ($1.38 per share), it was well under the average pundit projection. Collectively, the prognosticators were modeling net income of $1.67 per share.

Management said that tariffs imposed by the Trump administration negatively affected its performance. Another drag was a dip in unit volumes affecting the company's copper and brass products. Higher net selling prices helped to mitigate this, however.

Zooming out, Mueller didn't hesitate to mention that its key fundamentals in every quarter last year rose from the corresponding periods of 2024. It ended up posting the highest annual operating and net income figures in its long history.

But stocks trade on the future, not the recent past. On a somewhat pessimistic note, the company quoted CEO Greg Christopher as saying that "although we do not expect market conditions to abruptly rebound in 2026, we nonetheless anticipate considerable improvements as the year progresses."

As per its long-standing practice, Mueller did not provide specific financial guidance for the current quarter or for this year.

A dandy of a dividend raise

One of Mueller's actions following the earnings release was to announce that big dividend raise -- a bullish managerial move if ever there was one. The quarterly payout is getting a 40% lift, from $0.25 per share to $0.35. The enhanced dividend is to be paid on March 27 to investors of record as of March 13, and at the most recent closing share price, it would yield 1.2%.

Mueller is always highly dependent on the prices of the materials in which it specializes (chiefly copper and brass), so its financials can be somewhat up-and-down, and hard to estimate. Regardless, it's a well-managed, consistently profitable company, and, what's more, it's active in segments (like HVAC) serving the white-hot data center market.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Mueller Industries. The Motley Fool has a disclosure policy.