Waters Corporation
Waters Corporation Fundamental Analysis
Waters Corporation (WAT) shows moderate financial fundamentals with a PE ratio of 30.84, profit margin of 20.30%, and ROE of 28.52%. The company generates $3.2B in annual revenue with moderate year-over-year growth of 6.99%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 70.1/100 based on profitability, valuation, growth, and balance sheet metrics. The B grade reflects solid fundamentals with room for improvement in valuation or growth.
Fundamental Health Score
We analyze WAT's fundamental strength across five key dimensions:
Efficiency Score
ExcellentWAT demonstrates superior asset utilization.
Valuation Score
ModerateWAT shows balanced valuation metrics.
Growth Score
ModerateWAT shows steady but slowing expansion.
Financial Health Score
ModerateWAT shows balanced financial health with some risks.
Profitability Score
ExcellentWAT achieves industry-leading margins.
Key Financial Metrics
Is WAT Expensive or Cheap?
P/E Ratio
WAT trades at 30.84 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, WAT's PEG of -28.04 indicates potential undervaluation.
Price to Book
The market values Waters Corporation at 7.74 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 17.88 times EBITDA. This signals the market has high growth expectations.
How Well Does WAT Make Money?
Net Profit Margin
For every $100 in sales, Waters Corporation keeps $20.30 as profit after all expenses.
Operating Margin
Core operations generate 26.62 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $28.52 in profit for every $100 of shareholder equity.
ROA
Waters Corporation generates $12.64 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Waters Corporation produces operating cash flow of $652.55M, showing steady but balanced cash generation.
Free Cash Flow
Waters Corporation generates strong free cash flow of $539.80M, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $9.07 in free cash annually.
FCF Yield
WAT converts 2.73% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
30.84
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-28.04
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.74
vs 25 benchmark
P/S Ratio
Price to sales ratio
6.26
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.55
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.00
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.29
vs 25 benchmark
ROA
Return on assets percentage
0.13
vs 25 benchmark
ROCE
Return on capital employed
0.17
vs 25 benchmark
How WAT Stacks Against Its Sector Peers
| Metric | WAT Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 30.84 | 29.43 | Neutral |
| ROE | 28.52% | 800.00% | Weak |
| Net Margin | 20.30% | -20145.00% (disorted) | Strong |
| Debt/Equity | 0.55 | 0.30 | Weak (High Leverage) |
| Current Ratio | 0.00 | 4.64 | Weak Liquidity |
| ROA | 12.64% | -17936.00% (disorted) | Strong |
WAT outperforms its industry in 2 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Waters Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
39.63%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
28.56%
Industry Style: Defensive, Growth, Innovation
High GrowthFCF CAGR
-13.87%
Industry Style: Defensive, Growth, Innovation
Declining