Waters Corp (WAT, Financial) has recently captured the attention of investors and financial analysts alike, thanks to its solid financial standing and promising growth trajectory. Despite a daily loss of 3.94%, the stock has shown a positive three-month change of 3.77%, trading at $332.04. A detailed evaluation using the GF Score indicates that Waters Corp is poised for significant future growth.
What Is the GF Score?
The GF Score is a proprietary ranking system developed by GuruFocus, assessing stocks based on five key valuation aspects. These aspects have been backtested from 2006 to 2021, revealing a strong correlation with long-term stock performance. A higher GF Score typically indicates a higher potential for returns. Waters Corp has been awarded a GF Score of 93 out of 100, signaling strong potential for market outperformance.
- Financial strength rank: 6/10
- Profitability rank: 10/10
- Growth rank: 9/10
- GF Value rank: 5/10
- Momentum rank: 7/10
Understanding Waters Corp's Business
Waters Corp specializes in the production of liquid chromatography, mass spectrometry, and thermal analysis instruments. These tools are crucial for analyzing molecular structures and physical properties, aiding clients across biopharmaceuticals, industrial sectors, and academic institutions. With a market cap of $19.71 billion and sales of $2.88 billion, Waters Corp has maintained an impressive operating margin of 27.01%. In 2023, the company's revenue was primarily derived from biopharmaceutical customers (57%), followed by industrial clients (31%) and academic/government institutions (12%).
Financial Strength Breakdown
Waters Corp's financial resilience is evident through its robust balance sheet and strategic debt management. The company boasts an Interest Coverage ratio of 7.32, significantly above the benchmark of 5 set by investing legend Benjamin Graham. Additionally, its Altman Z-Score of 8.46 and a Debt-to-Revenue ratio of 0.73 further underscore its financial health and stability.
Profitability and Growth Metrics
Waters Corp stands out with a Profitability Rank of 10/10, reflecting its superior ability to generate profits relative to peers. The company's Gross Margin has consistently improved, reaching 59.57% in 2023. Its Predictability Rank of 5 stars indicates reliable operational performance, enhancing investor confidence.
Waters Corp's commitment to growth is evident in its Growth Rank of 9/10. The company has achieved a 3-Year Revenue Growth Rate of 9.6%, outperforming 59.49% of its industry peers. The consistent increase in EBITDA further highlights its growth capabilities.
Conclusion
Considering Waters Corp's robust financial strength, exceptional profitability, and consistent growth metrics, the GF Score distinctly highlights the company's strong position for potential market outperformance. Investors looking for similar opportunities can explore more companies with high GF Scores through 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.
