Waters Corporation (WAT)
Health Care · $45.9B market cap · SEC CIK 0001000697
ahead of 19% of the S&P 500 · #48 of 59 in Health Care
Next reports on Feb 8, 2027, after the close, with analysts expecting $4.71 in earnings per share.
52-week range $282.77 to $482.28. 1% below its 52-week high and 68% above its low.
The case for WAT
- Revenue up 52.5% on the year.
- Generated $540M of free cash flow in FY2025, 17% of revenue.
- Within 1% of its 52-week high: the trend is up.
The case against
- Expensive for its growth: 276.2× earnings, where 17% a year of growth would justify about 34×.
- Earnings per share down 63.9%.
- Return on equity of only 2%.
- Net margin of 3.6% leaves very little room for error.
- Free cash flow is only 1.2% of its market value, a thin cash return for the price.
- Price/sales of 9.9× is higher than 90% of Health Care companies.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Health Care companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 11 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 39 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 31 |
| Momentumhow the price has behaved lately | 84 |
| Stabilityhow violently it moves, what it owes and what it pays you | 68 |
- Each factor except momentum is half fixed thresholds, half rank among the 59 Health Care companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +52.5% |
|---|---|
| Over 5 years | +6.0% a year |
| FY2025 revenue | $3.2B (+7%) |
Free cash flow
Is it generating real cash? Yes, plenty
| FY2025 free cash flow | $540M |
|---|---|
| Of revenue | 17% |
| Of profit | 84% |
Profit margins
Is profitability improving? No, slipping
| Gross margin | 51% |
|---|---|
| Operating margin | 7% |
| Net margin, FY24 → FY25 → now | 21.6% → 20.3% → 3.6% |
Debt vs. cash
Is the balance sheet healthy? Yes, the debt is manageable
| Cash | $588M |
|---|---|
| Long-term debt | $947M |
| Net debt | $360M |
| Years to repay | 1.5 yrs |
Valuation
Is the stock price reasonable? No, expensive
| P/E | 276.2× |
|---|---|
| Fair P/E for its growth | 34× |
| P/FCF | 85.0× |
| Forward P/E | 30.0× |
| EV / EBITDA | 67.3× |
At 276.2× earnings it trades well above the 34× that 17% a year of growth would justify. At 85.0× free cash flow it trades well above that same mark.
The financials, five years deep
Pulled from Waters Corporation's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2025 | FY2024 | FY2023 | FY2022 | FY2021 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $3.2B | $3.0B | $3.0B | $3.0B | $2.8B |
| Change on the year | +7% | 0% | −1% | +7% | — |
| Free cash flow | |||||
| Free cash flow | $540M | $620M | $442M | — | — |
| Of revenue | 17% | 21% | 15% | — | — |
| Profit margins | |||||
| Operating margin | 25.4% | 27.9% | 27.7% | 29.4% | 29.5% |
| Net margin | 20.3% | 21.6% | 21.7% | 23.8% | 24.9% |
| Debt vs. cash | |||||
| Cash | $588M | $325M | $395M | $481M | $501M |
| Long-term debt | $947M | $1.6B | $2.3B | $1.5B | $1.5B |
| Net cash (debt) | −$360M | −$1.3B | −$1.9B | −$1.0B | −$1.0B |
Filings
The text of this 10-K could not be read automatically. The original is linked below.