Back to top

Analyst Blog

Zacks Equity Research

Waters Posts Disappointing 1Q

WAT A TMO

 ZacksTrade Now

This page is temporarily not available.  Please check later as it should be available shortly. If you have any questions, please email customer support at support@zacks.com or call 800-767-3771 ext.  9339.

Waters Corporation (WAT - Analyst Report) released its first-quarter 2012 earnings before the market opened today, reporting earnings per share from continuing operations of $1.00, below the Zacks Consensus Estimate of $1.09. Earnings in the quarter decreased from $1.04 in the first quarter of 2011.

The top-line and bottom-line performance failed to meet the company's expectations.

Revenue

On the top line, Waters reported total revenue of $428 million for the first quarter, down 2% year over year. Foreign currency translation had a negative impact of 2% on sales. The top-line result was affected by lower sales in the developing markets and declines in capital expense by many pharmaceutical firms.

Income

Operating income for the quarter amounted to $110.2 million compared with $115.9 million in the first quarter of 2011. The company incurred total SG&A expense of approximately $117.1 million in the quarter, almost flat year-over-year. R&D expense was approximately $23.3 million in the quarter versus $22.3 million in the prior-year quarter.

Balance Sheet

Cash, cash equivalents and short-term investments reached approximately $1.35 billion at the end of the quarter compared with $1.28 billion at the end of 2011. Long-term debt was $700.0 million and shareowner’s equity was $1.29 billion at the end of first-quarter 2012.

Moving Ahead

The company believes its strong competitive position and strategic market initiatives will facilitate it to perform well as it moves ahead.

The company continues to see considerable stability in its end markets and continued momentum in the acceptance of new products. The company continues to introduce new products. However, the analytical instrument and systems market is highly competitive. Major competitors of Waters are Agilent Technologies Inc. (A - Analyst Report), Life Technologies Corporation and Thermo Fisher Scientific Inc. (TMO - Analyst Report).

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.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

Learn more

Start for as little as $4.50 per trade.

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
LAKE SHORE G LSG 0.77 +6.05%
QUESTCOR PHA QCOR 80.07 +2.47%
VIPSHOP HOLD VIPS 156.35 +1.82%
ENLINK MIDST ENLC 36.29 +1.60%
BNC BANCORP BNCN 17.33 +1.58%