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1. Company Snapshot

1.a. Company Description

Waters Corporation, a specialty measurement company, provides analytical workflow solutions in Asia, the Americas, and Europe.It operates through two segments, Waters and TA.The company designs, manufactures, sells, and services high and ultra-performance liquid chromatography, as well as mass spectrometry (MS) technology systems and support products, including chromatography columns, other consumable products, and post-warranty service plans.


It also designs, manufactures, sells, and services thermal analysis, rheometry, and calorimetry instruments; and develops and supplies software-based products that interface with its instruments, as well as other manufacturers' instruments.Its MS technology instruments are used in drug discovery and development comprising clinical trial testing, the analysis of proteins in disease processes, nutritional safety analysis, and environmental testing.The company offers thermal analysis, rheometry, and calorimetry instruments for use in predicting the suitability and stability of fine chemicals, pharmaceuticals, water, polymers, metals, and viscous liquids for various industrial, consumer good, and healthcare products, as well as for life science research.


Its products are used by life science, pharmaceutical, biochemical, industrial, nutritional safety, environmental, academic, and governmental customers working in research and development, quality assurance, and other laboratory applications.Waters Corporation was founded in 1958 and is headquartered in Milford, Massachusetts.

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1.b. Last Insights on WAT

Waters Corporation's recent performance was driven by strong Q3 2025 results, with sales of $800 million exceeding guidance and growing 8% year-over-year. The company's non-GAAP EPS of $3.40 reflected 16% growth, beating estimates. Instruments and recurring revenue grew 6% and 9%, respectively, with strength in LC & MS and bioseparations products. The company raised its full-year 2025 guidance, citing broad-based growth across regions, including double-digit growth in the Americas. Cullen Frost Bankers Inc. also increased its stake in the company by 1,750%.

1.c. Company Highlights

2. Waters Corporation's Strong Q3 2025 Earnings: A Deeper Dive

Waters Corporation reported an impressive third quarter 2025, with sales growing 8% as reported and 8% in constant currency, reaching $800 million. Non-GAAP earnings per share were $3.40, a 16% increase from last year, beating analyst estimates of $3.21. The company's gross margin was approximately 59.2%, and adjusted operating margin was around 31%. The strong performance was driven by high single-digit growth in the LC-MS portfolio, 7% service growth, and 13% chemistry growth.

Publication Date: Nov -15

📋 Highlights
  • Sales Growth:: Q3 sales rose 8% reported and 8% in constant currency, with non-GAAP EPS at $3.40, up 16% YoY.
  • Recurring Revenue Expansion:: Recurring revenue grew 9%, driven by 13% chemistry growth and 7% service growth.
  • Guidance Upside:: Full-year 2025 sales guidance raised to 6.7–7.3% growth (7% midpoint), with adjusted EPS now $13.05–13.15 (10–11% growth).
  • Pharma & Bioseparations Momentum:: Pharma sales grew 11%, led by double-digit growth in Americas/Asia; bioseparations surged 13% with new product adoption.
  • BD Synergy Confidence:: Waters validated revenue/cost synergies from BD acquisition, expecting EPS accretion in 2026 and stable pharma demand post-MFN clarity.

Segment Performance

The Pharma segment grew 11%, driven by low double-digit growth in the Americas and Asia, reflecting robust instrument replacement activity and key wins in greenfield CapEx projects. The Industrial segment grew 4%, while Academic & Government grew 1%. Bioseparations growth was 13%, driven by the company's new product portfolio, including MaxPeak Premier, SEC columns, and Affinity Chromatography.

Guidance and Outlook

Waters Corporation raised its full-year 2025 guidance, expecting constant currency sales growth in the range of 6.7% to 7.3% and adjusted earnings per share in the range of $13.05 to $13.15, representing double-digit growth. For 2026, the company is well-positioned to build on its momentum, driven by the same growth drivers that powered its performance in 2025, including instrument replacement, higher service attachment, and increased product adoption through e-commerce.

Valuation and Growth Prospects

With a P/E Ratio of 34.81 and an EV/EBITDA of 23.82, the market is pricing in significant growth expectations. The company's ROE is 31.34%, and ROIC is 16.99%, indicating strong profitability. Analysts estimate revenue growth of 19.0% next year, suggesting that the company's growth prospects are promising. As the company continues to innovate and expand its product portfolio, it is likely to remain a strong player in the industry.

Key Drivers and Challenges

The company's growth is driven by its strong instrument replacement cycle, particularly in large pharma and CDMOs, as well as its innovative products, such as those in bioanalytical characterization and bioseparations. However, CROs, biotechs, and branded generics in China are on the sidelines, and the company faces challenges from the external environment, including tariffs and regulatory changes. Nevertheless, the company's diversified portfolio and strong execution capabilities position it well for sustained growth.

3. NewsRoom

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Cetera Investment Advisers Acquires 229 Shares of Waters Corporation $WAT

Dec -02

Source: defenseworld.net

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American Century Companies Inc. Trims Stock Position in Waters Corporation $WAT

Nov -26

Source: defenseworld.net

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Waters Corporation $WAT Shares Acquired by Aviso Financial Inc.

Nov -25

Source: defenseworld.net

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Waters Corporation (WAT) Presents at Jefferies London Healthcare Conference 2025 Transcript

Nov -18

Source: seekingalpha.com

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Waters Corporation to Present at the Jefferies Global Healthcare Conference in London

Nov -11

Source: prnewswire.com

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Waters Boosts Lab Productivity and Sample Throughput with Launch of its Charged Aerosol Detector Designed for Empower Software

Nov -11

Source: prnewswire.com

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Becton Dickinson Sees High Single-Digit Profit Growth Ahead, Plans Share Buybacks From Waters Deal

Nov -06

Source: benzinga.com

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Waters Q3 Earnings Surpass Estimates, Revenue Increase Y/Y

Nov -05

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.39%)

6. Segments

Waters Instrument Systems

Expected Growth: 4.5%

Waters Instrument Systems' 4.5% growth driven by increasing adoption of liquid chromatography and mass spectrometry in pharmaceutical and biotechnology industries, expansion in emerging markets, and growing demand for analytical instruments in food safety and environmental testing.

Waters Service

Expected Growth: 4.2%

Waters Service segment's 4.2% growth is driven by increasing demand for laboratory testing and analytical services, particularly in the pharmaceutical and biotechnology industries. Additionally, the company's strategic investments in digitalization and customer experience enhancements have improved service delivery and retention, contributing to the segment's growth.

Chemistry Consumables

Expected Growth: 4.8%

The 4.8% growth of Chemistry Consumables from Waters Corporation is driven by increasing adoption of liquid chromatography and mass spectrometry in pharmaceutical and biotechnology industries, rising demand for high-quality analytical instruments, and growing need for research and development in life sciences.

TA Instrument Systems

Expected Growth: 4.0%

TA Instrument Systems from Waters Corporation's 4.0% growth is driven by increasing adoption in biopharmaceutical and biomedical research, growing demand for high-performance liquid chromatography (HPLC) and ultra-performance liquid chromatography (UPLC) systems, and expansion into emerging markets, particularly in Asia.

TA Service

Expected Growth: 3.8%

The 3.8% growth of TA Service from Waters Corporation is driven by increasing adoption of liquid chromatography and mass spectrometry in biopharmaceutical and clinical research, coupled with growing demand for analytical services in the pharmaceutical industry, as well as expansion into emerging markets and strategic partnerships.

7. Detailed Products

Liquid Chromatography (LC) Systems

Waters Corporation offers a range of liquid chromatography systems for analytical and preparative separations, including HPLC, UHPLC, and SFC systems.

Mass Spectrometry (MS) Systems

Waters Corporation provides a range of mass spectrometry systems, including quadrupole, time-of-flight, and tandem quadrupole systems, for qualitative and quantitative analysis.

Gas Chromatography (GC) Systems

Waters Corporation offers a range of gas chromatography systems for analytical and preparative separations, including GC, GC-MS, and Headspace GC systems.

Sample Preparation and Handling

Waters Corporation provides a range of sample preparation and handling solutions, including automated sample preparation systems, vials, and consumables.

Informatics and Software

Waters Corporation offers a range of informatics and software solutions, including MassLynx, Empower, and UNIFI, for data acquisition, processing, and analysis.

Columns and Consumables

Waters Corporation provides a range of columns and consumables, including HPLC columns, GC columns, and sample preparation consumables.

8. Waters Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Waters Corporation operates in a niche market with high barriers to entry, reducing the threat of substitutes.

Bargaining Power Of Customers

Waters Corporation's customers are largely dependent on the company's products and services, giving them limited bargaining power.

Bargaining Power Of Suppliers

Waters Corporation has a diverse supplier base, but some suppliers have significant bargaining power due to their size and market presence.

Threat Of New Entrants

The high barriers to entry in the analytical instruments industry, including significant capital expenditures and regulatory hurdles, reduce the threat of new entrants.

Intensity Of Rivalry

The analytical instruments industry is highly competitive, with several established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 67.45%
Debt Cost 4.81%
Equity Weight 32.55%
Equity Cost 8.79%
WACC 6.11%
Leverage 207.19%

11. Quality Control: Waters Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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LabCorp

A-Score: 5.5/10

Value: 3.7

Growth: 4.3

Quality: 5.1

Yield: 2.0

Momentum: 8.5

Volatility: 9.3

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Medpace

A-Score: 4.8/10

Value: 1.3

Growth: 9.2

Quality: 8.1

Yield: 0.0

Momentum: 8.5

Volatility: 2.0

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Natera

A-Score: 4.5/10

Value: 4.0

Growth: 7.1

Quality: 3.3

Yield: 0.0

Momentum: 7.5

Volatility: 5.0

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Waters

A-Score: 3.9/10

Value: 1.5

Growth: 5.2

Quality: 7.5

Yield: 0.0

Momentum: 3.0

Volatility: 6.3

1-Year Total Return ->

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Twist Bioscience

A-Score: 3.6/10

Value: 6.8

Growth: 6.1

Quality: 4.8

Yield: 0.0

Momentum: 2.0

Volatility: 2.0

1-Year Total Return ->

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Charles River Laboratories

A-Score: 3.3/10

Value: 4.7

Growth: 4.1

Quality: 3.1

Yield: 0.0

Momentum: 3.5

Volatility: 4.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

394.81$

Current Price

394.81$

Potential

-0.00%

Expected Cash-Flows