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What's in the Cards for Waters Corp (WAT) in Q2 Earnings?
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Waters Corporation (WAT - Free Report) is set to report second-quarter 2018 results on Jul 24.
The company outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering an average positive earnings surprise of 2.38%.
In the last reported quarter, Waters’ earnings of $1.59 per share grew 8.9% on a year-over-year basis but declined 36.6% sequentially. The figure came ahead of the Zacks Consensus Estimate by 4 cents.
Net sales increased 6.6% year over year but decreased 22.7% sequentially to $531 million. The figure missed the Zacks Consensus Estimate of $533 million.
Improved end-market results especially in the pharmaceutical market drove year-over-year growth. Moreover, robust performance of Waters and TA product line were also positive.
Notably, shares of Waters have returned 6.6% over a year, outperforming the industry’s rally of 2.6%.
Let’s see how things are shaping up for this quarter.
Key Factors to Consider
The company remains optimistic about its strong product pipeline.
Its strong performing TA product line aided by the increasing regulatory activities regarding food safety and quality is expected to drive results in the industrial end market for the to-be-reported quarter. Moreover, the TA instruments will continue to perform well in the U.S. region.
Additionally, Waters’ leading position in the mass spectrometry market remains a key catalyst and is expected to drive its second-quarter results.
The company’s robust mass-spectrometry portfolio will continue to strengthen its performance in the biopharma space with the growing demand for biomolecules in the pharmaceutical industry.
During the second quarter, Waters expanded its mass spectrometry portfolio with the launch of new technical products for food safety and food authenticity namely Xevo TQ-GC System and DART QDa with LiveID System, respectively.
Further, the company has also rolled out ACQUITY QDa Practical MS Education Package which offers easy access to mass spectrometry equipments during the research work at Chemistry labs. Further, Waters in collaboration with Elucidata has combined its Symphony Data Pipeline software with the latter’s Polly Workflows and cloud applications to aid the biomedical researchers.
Nevertheless, the company will continue to benefit from the premium pricing in the liquid chromatography market with the support of its mass spectrometry technologies and UPLC system.
Moreover, Waters remain confident on its growth prospects in the Asian pharmaceutical market especially China and India, despite the company suffering due to sluggish sales in India during the first quarter.
Waters strong segmental and end-market performance remains the key driver of its top-line growth.
The Zacks Consensus Estimate for sales for the company's two operating segments – Waters and TA – are pegged at $526 million and $64 million, respectively.
By end-markets, the Zacks Consensus Estimate for sales in Pharmaceutical, Industrial and Governmental & Academic markets is pegged at $344 million, $188 million and $68 million, respectively.
What Our Model Says
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Waters currently has a Zacks Rank #3 and an Earnings ESP of +0.42%. Our proven model indicates that the company is likely to beat estimates in this quarter.
Other Stocks That Warrant a Look
Here are some other stocks worth considering as our model shows that these too have the right combination of elements to deliver an earnings beat in the upcoming releases.
Agilent Technologies (A - Free Report) has an Earnings ESP of +0.88% and a Zacks Rank #3.
Fortive (FTV - Free Report) has an Earnings ESP of +0.84 and a Zacks Rank #3.
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Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
Image: Bigstock
What's in the Cards for Waters Corp (WAT) in Q2 Earnings?
Waters Corporation (WAT - Free Report) is set to report second-quarter 2018 results on Jul 24.
The company outpaced the Zacks Consensus Estimate in the trailing four quarters, delivering an average positive earnings surprise of 2.38%.
In the last reported quarter, Waters’ earnings of $1.59 per share grew 8.9% on a year-over-year basis but declined 36.6% sequentially. The figure came ahead of the Zacks Consensus Estimate by 4 cents.
Net sales increased 6.6% year over year but decreased 22.7% sequentially to $531 million. The figure missed the Zacks Consensus Estimate of $533 million.
Improved end-market results especially in the pharmaceutical market drove year-over-year growth. Moreover, robust performance of Waters and TA product line were also positive.
Notably, shares of Waters have returned 6.6% over a year, outperforming the industry’s rally of 2.6%.
Let’s see how things are shaping up for this quarter.
Key Factors to Consider
The company remains optimistic about its strong product pipeline.
Its strong performing TA product line aided by the increasing regulatory activities regarding food safety and quality is expected to drive results in the industrial end market for the to-be-reported quarter. Moreover, the TA instruments will continue to perform well in the U.S. region.
Additionally, Waters’ leading position in the mass spectrometry market remains a key catalyst and is expected to drive its second-quarter results.
The company’s robust mass-spectrometry portfolio will continue to strengthen its performance in the biopharma space with the growing demand for biomolecules in the pharmaceutical industry.
During the second quarter, Waters expanded its mass spectrometry portfolio with the launch of new technical products for food safety and food authenticity namely Xevo TQ-GC System and DART QDa with LiveID System, respectively.
Further, the company has also rolled out ACQUITY QDa Practical MS Education Package which offers easy access to mass spectrometry equipments during the research work at Chemistry labs. Further, Waters in collaboration with Elucidata has combined its Symphony Data Pipeline software with the latter’s Polly Workflows and cloud applications to aid the biomedical researchers.
Nevertheless, the company will continue to benefit from the premium pricing in the liquid chromatography market with the support of its mass spectrometry technologies and UPLC system.
Moreover, Waters remain confident on its growth prospects in the Asian pharmaceutical market especially China and India, despite the company suffering due to sluggish sales in India during the first quarter.
Waters Corporation Price and EPS Surprise
Waters Corporation Price and EPS Surprise | Waters Corporation Quote
Positive Outlook
Waters strong segmental and end-market performance remains the key driver of its top-line growth.
The Zacks Consensus Estimate for sales for the company's two operating segments – Waters and TA – are pegged at $526 million and $64 million, respectively.
By end-markets, the Zacks Consensus Estimate for sales in Pharmaceutical, Industrial and Governmental & Academic markets is pegged at $344 million, $188 million and $68 million, respectively.
What Our Model Says
According to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has good chance of beating estimates if it also has a positive Earnings ESP. The Sell-rated stocks (Zacks Rank #4 or 5) are best avoided. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Waters currently has a Zacks Rank #3 and an Earnings ESP of +0.42%. Our proven model indicates that the company is likely to beat estimates in this quarter.
Other Stocks That Warrant a Look
Here are some other stocks worth considering as our model shows that these too have the right combination of elements to deliver an earnings beat in the upcoming releases.
AMETEK (AME - Free Report) has an Earnings ESP of +0.64% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Agilent Technologies (A - Free Report) has an Earnings ESP of +0.88% and a Zacks Rank #3.
Fortive (FTV - Free Report) has an Earnings ESP of +0.84 and a Zacks Rank #3.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot trades we're targeting>>