Waters Corporation WAT
Waters Corporation's FY2025 results show genuine top-line recovery with revenue growth of 7.0% YoY and meaningful deleveraging (total debt down from $1,702M to $1,491M), but earnings growth remains anemic at just 0.47% EPS growth as gross margin compressed from 59.4% to 57.8% and FCF margin fell from 21.0% to 17.1%. At $414.69 the stock trades at 103.2x P/E — a 268% premium to the peer median of 28.0x — and 39.9x EV/EBITDA versus a peer median of 16.0x, pricing in a level of profit growth that FY2025's $10.76 diluted EPS (still below FY2022's $11.73) does not yet support.
Smart money inflows are improving (score rising to 0.0809 as of Q2 2026 from 0.0282 at YE2025) and an analyst upgrade plus the HPV screening partnership are positive catalysts, but the risk/reward for new capital at this valuation is poor; existing exposure can be maintained on operational momentum.
What could go wrong
- Valuation compression. At 103.2x P/E and 39.9x EV/EBITDA, WAT trades at a 268% and 149% premium to peer medians respectively; any disappointment in growth trajectory could trigger a sharp de-rating.
- Margin erosion. Gross margin declined from 59.4% in FY2024 to 57.8% in FY2025 while FCF margin fell from 21.0% to 17.1%, signaling cost pressures that could further constrain earnings growth.
- Earnings stagnation. FY2025 diluted EPS of $10.76 remains below FY2022's $11.73, meaning the company has not reclaimed its prior earnings peak despite revenue reaching a new high of $3,165M.
- Insider selling. Director Christopher Kuebler exercised options and sold 3,626 shares at $397.94 on August 6, 2026, netting $1.44M; while 24-month insider activity is net positive, recent dispositions by senior officers are notable at these valuations.
What would change my mind
Where this comes from: peer_relative composite · peer_relative composite · derived_metrics FY2025 · derived_metrics FY2024–FY2025. Orin's read on WAT; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All WAT filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Massachusetts Financial Services /Ma/ | $2.5B | 0.8% of fund |
| Vanguard Capital Management | $2.4B | 0.1% of fund |
| Vanguard Portfolio Management | $1.8B | 0.1% of fund |
| State Street | $1.6B | 0.0% of fund |
| Invesco | $1.3B | 0.1% of fund |
| Geode Capital Management | $984.8M | 0.1% of fund |
97 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 80 Form 4 filings, net $13.3M. Of the 50 on hand, 2 were open-market purchases and 1 a sale— the rest are grants, option exercises and tax withholding.
Ask Orin about WAT
Orin answers questions about WAT from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 104.6× | 33.1× | 26.4× |
| EV/EBITDA | 51.4× | 22.6× | — |
| P/S | 8.89× | 7.14× | — |
| P/B | 2.7× | 16.9× | — |
Its P/E sits above all 5 of the last 5 years (+30.27σ from its own mean).
26.1%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $0.5B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$447
$387 – $515 · +6% against today's price
- 19 buy or overweight
- 16 hold
- 2 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| WATWaters Corporation | $41B | 104.6× | 51.4× | 50.8% | 3.6% | 2% |
| DGXQuest Diagnostics Incorporated | $26B | 24.4× | 15.7× | 33.1% | 9.2% | 14% |
| DXCMDexCom, Inc. | $33B | 33.9× | 21.4× | 62.5% | 20.1% | 36% |
| INCYIncyte Corporation | $25B | 15.3× | 10.4× | 92.6% | 27.7% | 30% |
| LHLabcorp Holdings Inc. | $25B | 25.0× | 14.7× | 27.8% | 7.0% | 12% |
| MTDMettler-Toledo International Inc. | $30B | 33.5× | 24.7× | 58.4% | 21.9% | -1200% |
| STESTERIS plc | $20B | 25.6× | 12.2× | 44.4% | 13.3% | 11% |
| WSTWest Pharmaceutical Services, Inc. | $26B | 47.8× | 32.0× | 36.8% | 17.0% | 19% |
| ZBHZimmer Biomet Holdings, Inc. | $18B | 22.0× | 12.6× | 69.9% | 9.5% | 6% |
The median is of the 8 peers listed above and nothing else — check it against the column. This company trades 313.6% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $235 | $366.29 · −36% | 2026-06-10 |
| Levered DCF | $162 | $366.29 · −56% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.