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Waters Corp. (WAT) Posts Strong Q3 Earnings Once Again

Waters CorporationWAT reported third-quarter 2015 non-GAAP earnings of $1.42 per share, surpassing the Zacks Consensus Estimate of $1.39 by 2.2% and the year-ago figure of $1.38 by 2.9%.

Waters Corporation - Earnings Surprise | FindTheBest

Strong operational performance across industrial and applied as well as life science end markets was the main driver. Moreover, on a GAAP basis, earnings came in at $1.40 per share, higher than $1.34 in the third quarter of 2014.

Inside the Headlines

In the quarter, Waters Corp.'s net sales increased about 1.5% year over year to $500.6 million and surpassed the Zacks Consensus Estimate of $493 million. This was primarily attributable to strong revenue generation in the quarter.

Gross profit for the quarter was $293.8 million, rising from $290.9 million reported in the prior-year quarter. However, operating income for the quarter declined to $135.8 million from $138.7 million in the third quarter of 2014, primarily owing to high research and development expenses.

Total selling and administrative expenses for the quarter came in at $124.7 million, which increased from $122.2 million in the third-quarter 2014. On the other hand, research and development expenses came in at $30.7 million, which increased from $27.3 million incurred in the prior-year quarter.

Liquidity

Waters Corporation's cash, cash equivalents and investments amounted to approximately $2.31 billion, higher than $2.06 billion as on Dec 31, 2014. The company's total liabilities increased to about $2.15 billion from $1.98 billion as on Dec 31, 2014.

Our Take

Keeping its winning streak alive, Waters Corp. again came up with an earnings beat this season on the back of improved operational performance and innovative product launches. Notably, the company has been benefitting from the life science end markets.

Waters Corp.'s active research & development division, primarily focused on the development and commercialization of products complement as well as update its existing product offerings. Going forward in 2015, the company aims to continue launching a number of products and programs in an effort to boost its revenues.

Waters Corp. currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks worth considering within the sector include Baxter International Inc. BAX , Hill-Rom Holdings, Inc. HRC and SurModics, Inc. SRDX . All stocks carry a Zacks Rank #1 (Strong Buy).

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WATERS CORP (WAT): Free Stock Analysis Report

BAXTER INTL (BAX): Free Stock Analysis Report

SURMODICS (SRDX): Free Stock Analysis Report

HILL-ROM HLDGS (HRC): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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