Waters Corporation Stock Underperforms: Analyst Estimates & Ratings

Waters Corporation (WAT) stock has underperformed the broader market over the past year, declining 12% compared to the S&P 500's 15.1% gain. Analysts expect a 9.4% EPS growth for the current fiscal year, with a consensus rating of "Moderate Buy". The mean price target of $362.35 suggests a 22.4% premium to current price levels, with a Street-high target of $465 implying a 57% upside potential.

Waters Corporation (NYSE: WAT) has experienced a notable decline in its stock performance over the past year, dropping by 12% compared to the S&P 500's 15.1% gain. Despite this underperformance, analysts remain cautiously optimistic, with a consensus rating of "Moderate Buy" and an expected earnings per share (EPS) growth of 9.4% for the current fiscal year. The mean price target of $362.35 suggests a 22.4% premium to the current price levels, with a Street-high target of $465 implying a significant upside potential of 57%.

In the second quarter of 2025, Waters Corporation reported revenues of $771.3 million, marking an 8.9% year-on-year increase. This performance exceeded analysts’ expectations by 3.3%, driven by robust instrument replacement trends, particularly among large pharmaceutical and contract development and manufacturing organizations (CDMOs). However, the company's stock has not reflected this positive earnings report, with a 1.9% increase since the latest earnings results.

The underperformance of Waters Corporation's stock relative to its peers and the broader market can be attributed to several factors. One key challenge is the high research and development (R&D) investment required to maintain technological leadership, which can strain the company's financials. Additionally, pricing pressures from budget-conscious institutions and the vulnerability to fluctuations in research funding cycles can impact the company's revenue growth.

Looking ahead, Waters Corporation stands to benefit from growing demand for tools supporting emerging fields such as synthetic biology and personalized medicine. The integration of automation and AI-driven solutions in laboratories could also create new opportunities for the company to sell its tools and consumables. However, the company remains sensitive to supply chain disruptions and macroeconomic conditions that affect research funding.

Despite the recent underperformance, analysts remain optimistic about Waters Corporation's long-term prospects. The company's strong product portfolio and customer loyalty position it well to capitalize on future growth opportunities. Investors should closely monitor the company's ability to manage its R&D costs and navigate the challenges posed by supply chain disruptions and macroeconomic conditions.

References:
[1] https://finance.yahoo.com/news/winners-losers-q2-waters-corporation-033446316.html