Waters Joins Forces with Bio Firm

Waters Corporation (WAT - Analyst Report) and PREMIER Biosoft International (Palo Alto, CA) have collaborated to market and resell their products for advancement of lipidomics research. As per the agreement, PREMIER Biosoft's SimLipid® informatics platform will be offered for sale by Waters together with Waters® ACQUITY UPLC® and high-resolution, exact mass SYNAPT® and XEVO® mass spectrometers for lipid analysis.

Further, Waters will continue to sell and support its UPLC and mass spectrometers for lipid analysis, while PREMIER Biosoft will market its characterization tool to Waters customers analyzing lipid data.

SimLipid software product was launched by PREMIER Biosoft earlier in 2011. The UPLC/MS systems from Waters combine UltraPerformance LC® and proprietary ion mobility mass spectrometry technology with advanced lipidomics informatics for complete and precise lipid characterization from complex biological samples. This helps in meeting challenges faced by leading lipid researchers.

Waters and PREMIER Biosoft have entered into an agreement in 2010 to co-market PREMIER Biosoft's SimGlycan data analysis software tool.

In the long term, we expect Waters to benefit from its strong presence in the chromatography instrument market. A strong customer demand in mass spectrometry and HPLC will help the company to sustain healthy performance in its organic sales growth over the next few years.

Further, a significant portion of Waters’ revenue is derived from recurring revenue sources, including consumables and services, which are expected to continue to increase over the longer term.

However, the analytical instrument and systems market is highly competitive. Major competitors of Waters are Agilent Technologies Inc. (A - Analyst Report), Life Technologies Corporation (LIFE - Analyst Report) and Thermo Fisher Scientific Inc. (TMO - Analyst Report). Waters competes in its markets primarily based on instrument performance, reliability, service, and to a lesser extent, price.

Some competitors have instrument businesses that are generally more diversified, but are typically less focused on the company’s chosen markets. Some other competitors have greater financial and other resources compared to Waters.

Waters Corporation, an analytical instrument manufacturer, designs, manufactures, sells and services, through its Waters Division, high performance liquid chromatography, ultra performance liquid chromatography (LC) and mass spectrometry (MS) instrument systems and support products, including chromatography columns, other consumable products and comprehensive post-warranty service plans.

We currently maintain our Neutral rating on Waters with a Zacks #2 Rank (short-term Buy recommendation) over the next one-to-three months.

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