WHAT
Complete fundamental analysis of Waters Corporation (WAT)
Executive summary
Waters Corporation (WAT), listed on the New York Stock Exchange (NYSE), is a leader in laboratory analytical instruments, specializing in chromatography, mass spectrometry, and biopharmaceuticals. With a market capitalization of $17.91 billion and a current price of $302.48 (as of September 22, 2025), it shows solid margins but moderate growth. This analysis includes financial statements, valuation ratios, growth trends, strengths and weaknesses, and comparisons with competitors. Conclusion : The stock appears to be reasonably priced , with moderate growth potential, although its high PEG suggests caution.
Review of financial statements
Income and profits
Revenue is stable (approximately USD 3 billion annually), with a slight increase in 2024. Net income is solid, driven by operational efficiency.
Margins
Consistent and high margins in the sector: gross ~59%, operating ~28%, net ~22%, reflecting efficiency.
Debt and liquidity
Long-term debt is not disclosed, but equity increased from $367 million (2021) to $1.83 billion (2024). The debt-to-equity ratio is between 1.0 and 1.5. The ROA (11.7%) indicates sound asset management.
Dividends
WAT does not pay dividends (0% yield, 0% payout ratio) and focuses on reinvestment.
Valuation ratios
The ratios reflect a superior valuation. PER of 27x, future 21x. The high ROE (37%) justifies a P/B of 8.3x.
Beta: 1.07. 52-week range: $275.05 - $423.56.
Growth trends
Last 5 years
Stable revenue growth (CAGR of ~0-1%). Earnings per share (EPS) stable at ~$11 (CAGR of ~-1% since 2020). Factors: pharmaceutical dependence and the impact of COVID-19.
Current trend (2025)
Outlook: Revenue: $3.14 billion in 2025 (+3% year-over-year), $3.34 billion in 2026 (+6%). EPS growth: 9.5% (2025), 9.9% (2026). Free cash flow: $0.70 billion (2025) with a future growth of $1.4 billion.
Main strengths and weaknesses
Strengths
- Innovation leadership : Dominance in chromatography/spectrometry (~20-25% market share).
- High margins : ROE 37%, net margins >20%, higher than its peers.
- Growth through acquisitions : Expansion in biopharmaceuticals, targeting 5-7% organic growth by 2025.
Weaknesses
- Slow growth : Dependent on the pharmaceutical and biotechnology industry (70% of sales), vulnerable to R&D cuts.
- No dividends : Not attractive to income-generating investors; high PEG (5x).
- Regulatory pressures : FDA/Europe compliance costs.
Comparison with the main competitors
Competitors: Thermo Fisher (TMO), Agilent (A), Danaher (DHR). WAT excels in profitability, but its growth is slower.
Analysis : WAT leads in ROE, but TMO and DHR grow more thanks to diversification. Agilent offers similar analysis, but on a smaller scale. WAT is superior to TMO in PEG, but its niche justifies this.
Conclusion: overall assessment
WAT is reasonably priced . The forward PE (21x) aligns with EPS growth (~10%), and ROE supports a high price-to-book ratio. The high PEG (5x) and flat growth suggest risk if the biotech slows. Recommendation : Hold; buy on dips <$290. Upside potential of 10-15% over 12 months due to the Q4 2025 rally.
The content of this analysis is for informational purposes only and does not constitute an investment recommendation.
Complete fundamental analysis of Waters Corporation (WAT)
Executive summary
Waters Corporation (WAT), listed on the New York Stock Exchange (NYSE), is a leader in laboratory analytical instruments, specializing in chromatography, mass spectrometry, and biopharmaceuticals. With a market capitalization of $17.91 billion and a current price of $302.48 (as of September 22, 2025), it shows solid margins but moderate growth. This analysis includes financial statements, valuation ratios, growth trends, strengths and weaknesses, and comparisons with competitors. Conclusion : The stock appears to be reasonably priced , with moderate growth potential, although its high PEG suggests caution.
Review of financial statements
Income and profits
Revenue is stable (approximately USD 3 billion annually), with a slight increase in 2024. Net income is solid, driven by operational efficiency.
| Year | Revenue (USD millions) | B. Bruto (M USD) | I. Operativo (M USD) | B. Neto (M USD) | Earnings per share (USD) |
|---|---|---|---|---|---|
| 2024 | 3046 | 1798 | 845 | 661 | 11.09 |
| 2023 | 2958 | 1758 | 838 | 638 | 10.71 |
| 2022 | 2956 | 1761 | 818 | 642 | 10.84 |
| 2021 | 2972 | 1724 | 883 | 708 | 11.73 |
Margins
Consistent and high margins in the sector: gross ~59%, operating ~28%, net ~22%, reflecting efficiency.
| Year | Gross (%) | Operating margin (%) | M. Neto (%) |
|---|---|---|---|
| 2024 | 59.0 | 27.7 | 21.7 |
| 2023 | 59.4 | 28.3 | 21.6 |
| 2022 | 59.6 | 27.7 | 21.7 |
| 2021 | 58.0 | 29.7 | 23.8 |
Debt and liquidity
Long-term debt is not disclosed, but equity increased from $367 million (2021) to $1.83 billion (2024). The debt-to-equity ratio is between 1.0 and 1.5. The ROA (11.7%) indicates sound asset management.
| Year | Assets (millions of USD) | Pasivos (M USD) | Assets (millions of USD) |
|---|---|---|---|
| 2024 | 4554 | 2725 | 1829 |
| 2023 | 4627 | 3477 | 1150 |
| 2022 | 3281 | 2777 | 504 |
| 2021 | 3095 | 2727 | 368 |
Dividends
WAT does not pay dividends (0% yield, 0% payout ratio) and focuses on reinvestment.
Valuation ratios
The ratios reflect a superior valuation. PER of 27x, future 21x. The high ROE (37%) justifies a P/B of 8.3x.
| Relationship | Value |
|---|---|
| Current price (USD) | 302.48 |
| Market capitalization (B USD) | 17.91 |
| Tracking PER | 27.13 |
| PER Forward | 21.14 |
| PEG ratio | 5.04 |
| Price/Sales | 5.89 |
| Price/Book | 8.29 |
| EV/EBITDA | 18.05 |
| LENGTH (%) | 11.70 |
| ROE (%) | 37.03 |
| Dividend yield (%) | 0.00 |
Beta: 1.07. 52-week range: $275.05 - $423.56.
Growth trends
Last 5 years
Stable revenue growth (CAGR of ~0-1%). Earnings per share (EPS) stable at ~$11 (CAGR of ~-1% since 2020). Factors: pharmaceutical dependence and the impact of COVID-19.
Current trend (2025)
Outlook: Revenue: $3.14 billion in 2025 (+3% year-over-year), $3.34 billion in 2026 (+6%). EPS growth: 9.5% (2025), 9.9% (2026). Free cash flow: $0.70 billion (2025) with a future growth of $1.4 billion.
Main strengths and weaknesses
Strengths
- Innovation leadership : Dominance in chromatography/spectrometry (~20-25% market share).
- High margins : ROE 37%, net margins >20%, higher than its peers.
- Growth through acquisitions : Expansion in biopharmaceuticals, targeting 5-7% organic growth by 2025.
Weaknesses
- Slow growth : Dependent on the pharmaceutical and biotechnology industry (70% of sales), vulnerable to R&D cuts.
- No dividends : Not attractive to income-generating investors; high PEG (5x).
- Regulatory pressures : FDA/Europe compliance costs.
Comparison with the main competitors
Competitors: Thermo Fisher (TMO), Agilent (A), Danaher (DHR). WAT excels in profitability, but its growth is slower.
| Metric | W.A.T | TMO (Rev. 42.9B) | A (Revelation 6.5B) | DHR (Rev. 23.9B) |
|---|---|---|---|---|
| PE Forward | 21.1 | 25 | 22 | 28 |
| ROE (%) | 37 | 15 | 25 | 12 |
| 5Y CAGR Growth (%) | 1 | 8 | 5 | 10 |
| Net margin (%) | 22 | 15 | 18 | 16 |
| Debt/Equity | 1.5 | 0.8 | 0.6 | 0.4 |
Analysis : WAT leads in ROE, but TMO and DHR grow more thanks to diversification. Agilent offers similar analysis, but on a smaller scale. WAT is superior to TMO in PEG, but its niche justifies this.
Conclusion: overall assessment
WAT is reasonably priced . The forward PE (21x) aligns with EPS growth (~10%), and ROE supports a high price-to-book ratio. The high PEG (5x) and flat growth suggest risk if the biotech slows. Recommendation : Hold; buy on dips <$290. Upside potential of 10-15% over 12 months due to the Q4 2025 rally.
The content of this analysis is for informational purposes only and does not constitute an investment recommendation.
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