Stablecoins are here to stay says BlackRock
On Wednesday, Baird analyst Catherine Schulte upgraded Waters Corp . (NYSE: WAT) stock rating from Neutral to Outperform. Accompanying the upgrade, Schulte increased the price target to $407 from the previous $396. The upgrade reflects a growing confidence in the company’s long-term revenue and margin prospects. The company, currently valued at $21.89 billion, trades at a P/E ratio of 34.36x and maintains a healthy gross margin of 59.43%.According to InvestingPro, Waters Corp. maintains a "GOOD" overall financial health score, with 10+ additional key insights available to subscribers.
Schulte’s optimism is based on insights gathered during Waters Corp.’s investor day held earlier this month, as well as subsequent discussions with the company’s Investor Relations team. The analyst believes that the company’s liquid chromatography (LC) segment could perform well in the current year, which has been marked by uneven market conditions. The company’s stable performance is reflected in its low price volatility, with annual revenue reaching $2.96 billion.
The positive pharmaceutical spending commentary and the dynamics of the replacement cycle were cited as factors that could contribute to the company’s strong performance. Furthermore, Schulte noted that Waters Corp. has very limited exposure to National Institutes of Health (NIH) funding, which is considered a positive in the context of the company’s financial outlook.
Despite a valuation gap compared to some peers, which appears wider than usual, Schulte justifies a premium for Waters Corp. shares. This is due to the anticipated business momentum, with revenue growth in 2025 expected to surpass that of most peers. Additionally, the analyst pointed out that the relative valuation of Waters Corp. compared to the S&P 500 is roughly in line with historical averages, supporting the case for the current stock valuation.
In other recent news, Waters Corporation (NYSE:WAT) has been the subject of several analyst reviews following its Investor Day event. Leerink Partners increased its price target for Waters Corp. to $430, maintaining an Outperform rating, reflecting confidence in the company’s growth strategies and financial goals. Bernstein also reiterated an Outperform rating with a $430 target, noting Waters Corp.’s impressive 8% growth in constant currency terms, which outpaced its peers. TD Cowen maintained a Hold rating with a $410 target, highlighting Waters Corp.’s ambitious margin expansion plans and robust sales growth prospects, despite concerns over high valuation.
Stifel also kept a Hold rating with a $360 target, acknowledging the company’s growth potential while expressing caution about its stock valuation. Meanwhile, BofA Securities adjusted its price target to $410 from $430, maintaining a neutral rating due to expectations already factored into the stock’s valuation. The upcoming Investor Day is anticipated to provide further insights into Waters Corp.’s financial outlook and strategic initiatives, including new growth drivers and market expansions. These developments indicate a period of strategic focus for Waters Corp., as analysts assess its potential for future performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.