Waters (WAT) to Report Q4 Earnings: What's in the Offing?
Waters Corporation WAT is scheduled to report its fourth-quarter 2023 results on Feb 6.
For the fourth quarter, the company anticipates net sales to decline 8-5% on a constant-currency basis. The Zacks Consensus Estimate for net sales is pegged at $813.73 million, indicating a decline of 5.2% from the year-ago quarter’s reported figure.
WAT expects non-GAAP earnings between $3.52 and $3.62 per share. The Zacks Consensus Estimate for the same is pegged at $3.56 per share, suggesting a decline of 7.3% from the year-ago quarter’s reported figure. The estimate has remained unchanged over the past 30 days.
Waters’ earnings beat estimates in three of the trailing four quarters while missing the same once, the average being 4.4%.
Let’s see how things might have shaped up for this announcement.
Waters Corporation Price and EPS Surprise
Waters Corporation price-eps-surprise | Waters Corporation Quote
Factors to Consider
Waters’ growing investments to introduce innovative products and enhance its revitalized portfolio for target markets are anticipated to have contributed to its performance during the to-be-reported quarter.
The company’s growing efforts to achieve operational excellence on the back of its strong pricing, productivity and cost strategies, are expected to have benefited the upcoming results.
These factors are expected to have driven growth in the Waters services business during the fourth quarter. The Zacks Consensus Estimate for the Waters services sales is pegged at $249.79 million, indicating growth of 8.5% from the year-ago reported figure.
The company’s growing momentum in the large-molecule market, owing to its growing investments in liquid chromatography and mass spectrometry, is likely to have aided its performance in the fourth quarter.
Strength across Per-and Polyfluoroalkyl Substances (PFAS) and battery testing applications might have been another positive.
Expanding Wyatt portfolio, owing to the launch of its first light scattering instrument, is expected to have benefited WAT’s top line in the quarter under review.
However, sluggishness in the overall demand environment is expected to have been a major headwind for the company in the to-be-reported quarter.
Weakness in China across pharma, industrial, academic and government end markets are expected to have acted as a headwind for the company.
The Zacks Consensus Estimate for fourth-quarter 2023 Industrial revenues is pegged at $244.75 million, indicating a decline of 8.7% on a year-over-year basis.
The consensus mark for Academic & Government revenues stands at $96.9 million, indicating a fall of 0.9% year over year.
Moreover, foreign exchange fluctuations and challenging macroeconomic scenario are expected to have negatively affected WAT’s quarterly performance.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Waters currently has an Earnings ESP of -0.77% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies worth considering from the same space, as our model shows that these have the right combination of elements to beat on earnings in their soon-to-be-reported quarterly results.
BlackLine BL has an Earnings ESP of +2.62% and a Zacks Rank #1 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
BlackLine is scheduled to release fourth-quarter 2023 results on Feb 13. The Zacks Consensus Estimate for BL’s earnings is pegged at 55 cents per share, suggesting a jump of 57.1% from the prior-year quarter.
Twilio TWLO has an Earnings ESP of +31.37% and a Zacks Rank #2 at present.
Twilo is set to announce fourth-quarter 2023 results on Feb 14. The Zacks Consensus Estimate for TWLO’s earnings is pinned at 57 cents per share, indicating growth from the year-ago quarter’s figure of 22 cents per share.
Bill Holdings BILL has an Earnings ESP of +6.17% and a Zacks Rank #3.
Bill Holdings is set to announce second-quarter fiscal 2024 results on Feb 8. The Zacks Consensus Estimate for BILL’s earnings is pinned at 41 cents per share, suggesting a fall of 2.4% from the year-ago quarter.
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