We expect scientific instruments manufacturer
) to beat expectations when it reports fourth-quarter 2013
results on Jan 28, 2014.
Why a Likely Positive Surprise?
Our proven model shows that Waters is likely to beat earnings
because it has the right combination of two key ingredients.
Earnings Surprise Prediction or ESP (Read:
Zacks Earnings ESP: A Better Method
), which represents the difference between the Most Accurate
estimate and the Zacks Consensus Estimate, is at 0.62%. This is a
leading indicator of a likely positive earnings surprise for
Zacks Rank #3 (Hold):
Note that stocks with Zacks Ranks of #1, 2 or 3 have a
significantly higher chance of beating earnings. Sell-rated
stocks (#4 and 5) should never be considered going into an
The combination of Waters' Zacks Rank #3 and 0.62% ESP makes
us very confident of a positive earnings beat on Jan 28.
What is Driving the Better-Than-Expected
Global demand is increasing strongly in the company's end
markets, especially in China, Europe and Latin America. Moreover,
with increased R&D investment, Waters always launches new
products in the market which attract new revenue opportunities.
Additionally, Waters is in a healthy position owing to strategic
acquisitions including Baehr Thermoanalyse GmbH and Blue
Reference, Inc. made last year which are expected to contribute
approximately $10 million to annual sales going
Although, the company has been experiencing
slower-than-expected growth in both the top and bottom lines, it
reported a year-on-year increase in both earnings and revenues in
the third-quarter results. Further, fair pricing of products and
its cost-control effort helped the company deliver stable levels
of profitability. Waters has continued to benefit from newer core
offerings in chromatography, mass spectrometry and thermal
Other Stocks to Consider
Waters is not the only firm looking up this earnings season.
We also see likely earnings beats coming from these
), with Earnings ESP of +33.33% and a Zacks Rank #1 (Strong
), with Earnings ESP of +25.00% and a Zacks Rank #2 (Buy).
), with Earnings ESP of +4.00% and a Zacks Rank #2.
GORMAN RUPP CO (GRC): Free Stock Analysis
NOKIA CP-ADR A (NOK): Free Stock Analysis
WATERS CORP (WAT): Free Stock Analysis Report
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