Waters Corp (WAT, Financial) has recently captured the attention of investors and financial analysts, thanks to its strong financial performance. With a current share price of $322.32, Waters Corp has experienced a daily gain of 0.24% and a three-month change of 5.7%. A detailed analysis, supported by the GF Score, indicates that Waters Corp is poised for significant growth in the foreseeable future.
What Is the GF Score?
The GF Score is a proprietary stock performance ranking system developed by GuruFocus. It evaluates stocks based on five key aspects: financial strength, profitability, growth, GF Value, and momentum, which are crucial for long-term performance. Stocks with higher GF Scores typically yield higher returns. The GF Score ranges from 0 to 100, with 100 indicating the highest potential for outperformance. Waters Corp has been assigned a GF Score of 97, reflecting its strong potential for market outperformance.
Understanding Waters Corp's Business
Waters Corp, with a market cap of $19.12 billion and annual sales of $2.91 billion, specializes in manufacturing analytical instruments like liquid chromatography, mass spectrometry, and thermal analysis tools. These instruments are vital for analyzing molecular structures and physical properties, aiding industries from biopharmaceuticals to academic institutions. In 2023, Waters Corp's sales distribution included 57% from biopharmaceutical customers, 31% from industrial clients, and 12% from academic and government institutions.
Financial Strength Breakdown
Waters Corp's financial robustness is evident in its Financial Strength Rank of 6/10. The company boasts an Interest Coverage ratio of 7.45, significantly above the benchmark of 5 set by Benjamin Graham, indicating strong capability to meet interest obligations. Additionally, an Altman Z-Score of 5.14 suggests low risk of financial distress, and a Debt-to-Revenue ratio of 0.71 further confirms its sound financial management.
Profitability and Growth Metrics
Waters Corp's Profitability Rank stands at a perfect 10/10. The company's Gross Margin has consistently improved over the past five years, reaching 59.57% in 2023. This trend highlights its increasing efficiency in converting revenue into profit. Furthermore, Waters Corp's Predictability Rank of 5 stars reflects its stable operational performance, enhancing investor confidence.
Waters Corp also excels in growth, with a Growth Rank of 10/10. The company's 3-Year Revenue Growth Rate of 9.6% surpasses 60% of its peers in the Medical Diagnostics & Research industry. Its EBITDA growth over the past three and five years further underscores its growth capabilities.
Conclusion
Considering Waters Corp's impressive financial strength, profitability, and growth metrics, the GF Score highlights the firm's unparalleled position for potential outperformance. Investors looking for similar opportunities can explore more companies with strong GF Scores using the GF Score Screen.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
