Waters Corporation (WAT – Free Report) shares rose 0.74% in the after-hours trading as it reported fourth-quarter 2024 non-GAAP earnings of $4.10 per share, beating the Zacks Consensus Estimate by 1.99%. The company had registered earnings of $3.62 in the year-ago quarter, increasing 13.3% on a year-over-year basis.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Net sales of $872.7 million topped the Zacks Consensus Estimate of $857 million. The figure increased 6.5% on a reported basis and grew 8% on a constant-currency basis from the year-ago quarter.
Waters delivered a strong fourth quarter, driven by double-digit growth in the Pharma segment, while both instrument sales and recurring revenue posted high-single-digit gains in constant currency. Growth rebounded across all major regions — Asia, the Americas and Europe — led by the strong adoption of new products and the successful execution of strategic initiatives.
Waters Corporation Price, Consensus and EPS Surprise
Waters Corporation price-consensus-eps-surprise-chart | Waters Corporation Quote
WAT’s Top Line in Detail
Waters’ net sales figure can be categorized in four ways:
Operating Segment: WAT operates under two organized segments — Waters and TA.
The Waters segment (87.6% of net sales) generated sales worth $764.3 million, up 6.6% year over year. Sales in the TA segment were $108.4 million (12.4% of net sales), reflecting 5.7% year-over-year growth.
Products & Services: The division comprises three segments — Instruments, Services and Chemistry.
Instruments sales (48.1% of net sales) were $419.6 million, increasing 5.6% on a year-over-year basis.
Services sales (34.6% of net sales) were $301.8 million, climbing 8.2% year over year.
Chemistry sales (17.3% of net sales) were $151.3 million, growing 5.5% year over year.
The Services and Chemistry segments jointly generated recurring revenues of $453.1 million, up 7.3% year over year.
Markets: Waters serves three end markets — Pharmaceutical, Industrial, and Governmental and Academic.
The Pharmaceutical market (57.2% of net sales) generated sales of $498.8 million, which increased 7.6% on a year-over-year basis.
The Industrial market’s (30.3% of net sales) sales were $264 million, up 1.5% year over year.
The Governmental and Academic market (12.6% of net sales) generated $109.9 million in sales, which rose 15% year over year.
Geography: Waters’ operating regions include Asia, the Americas and Europe.
Asia (31.3% of net sales) generated $272.9 million in sales, up 4.2% on a year-over-year basis.
Sales in the Americas (36.8% of net sales) were $321 million, increasing 5.7% year over year.
Europe (31.9% of net sales) generated $278.8 million in sales, up 9.8% year over year.
WAT’s Operating Details
In the fourth quarter, non-GAAP selling and administrative expenses were $168.5 million, down 2.6% year over year. As a percentage of net sales, the figure contracted 180 basis points (bps) on a year-over-year basis.
Research and development spending of $46.3 million increased 8.9% year over year. As a percentage of net sales, the figure expanded 10 bps year over year.
The adjusted operating margin was 35.5%, which increased by 60 bps year over year.
Waters’ Balance Sheet & Cash Flow
As of Dec. 31, 2024, cash, cash equivalents and investments were $325.4 million, down from $331.5 million as of Sept. 28, 2024.
Waters generated cash from operations of $240.1 million in the reported quarter, up from $204.6 million in the prior quarter.
The company recorded a free cash flow of $188 million in the fourth quarter.
WAT Initiates Q1 & 2025 Guidance
For the first quarter of 2025, Waters expects non-GAAP earnings of $2.17-$2.25 per share.
The Zacks Consensus Estimate for earnings is pegged at $2.47, unchanged over the past 30 days, indicating 11.76% growth from the figure reported in the year-ago quarter.
Management anticipates organic sales to grow 4-7% on a constant-currency basis. WAT projects 3% lower sales growth due to the impacts of foreign exchange fluctuations.
On a reported basis, total sales growth is predicted to be 1-4%.
The Zacks Consensus Estimate for revenues is pegged at $678.85 million, suggesting 6.60% year-over-year growth.
For 2025, Waters anticipates non-GAAP earnings of $12.70-$13.00 per share.
The Zacks Consensus Estimate for earnings is pegged at $12.80, down 8 cents over the past 30 days, indicating an 8.52% decline from the figure reported in 2023.
Waters projects 2024 organic sales to increase 4.5-7% on a constant-currency basis. WAT projects sales growth to be affected by 2% due to unfavorable foreign exchange fluctuations.
On a reported basis, total sales are projected to grow 2.5-5%.
The Zacks Consensus Estimate for revenues is pegged at $3.10 billion, indicating year-over-year growth of 5.48%.
Waters Zacks Rank & Stocks to Consider
Currently, Waters carries a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader medical market sector are Alnylam Pharmaceuticals (ALNY – Free Report) , AdaptHealth (AHCO – Free Report) and Outset Medical (OM – Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Alnylam Pharmaceuticals shares have gained 13% in the year-to-date period. ALNY’s long-term earnings growth rate is projected at 32.56%.
AdaptHealth shares have declined 6% in the year-to-date period. The long-term earnings growth rate for AHCO is anticipated at 8.13%.
Outset Medical shares have lost 29.7% in the year-to-date period. OM’s long-term earnings growth rate is estimated to be 25.07%.
Financial Market Newsflash
No financial news published today. Check back later.
