Waters Fourth Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Waters (NYSE:WAT) will unveil its latest earnings tomorrow, Tuesday, January 22, 2013. Waters is an analytical instrument manufacturer that designs, manufactures, sells and services liquid chromatography, ultra performance liquid chromatography, mass spectrometry instrument systems, and support products.

Waters Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of $1.58 per share, a rise of 1.3% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved down from $1.59. Between one and three months ago, the average estimate moved down. It has been unchanged at $1.58 during the last month. Analysts are projecting profit to rise by 2.3% versus last year to $4.92.

Past Earnings Performance: Last quarter, the company met expectations by reporting net income of $1.18 per share last quarter. In the previous second quarter, the company beat estimates by one cent.

Start 2013 better than ever by saving time and making money with your Limited Time Offer for our highly-acclaimed Stock Picker Newsletter. Click here for our fresh Feature Stock Pick now!

Stock Price Performance: Between October 18, 2012 and January 15, 2013, the stock price rose $9.80 (12.1%), from $81.10 to $90.90. It saw one of its worst periods between November 6, 2012 and November 14, 2012 when shares fell for seven straight days, dropping 5.4% (-$4.64) over that span. The stock price saw one of its best stretches over the last year between September 5, 2012 and September 13, 2012, when shares rose for seven straight days, increasing 7% (+$5.54) over that span.

A Look Back: In the third quarter, profit fell 2.1% to $99.1 million ($1.12 a share) from $101.3 million ($1.10 a share) the year earlier, meeting analyst expectations. Revenue fell 1% to $450 million from $454.5 million.

Here’s how Waters traded following its last earnings report 3 months ago and leading up to its upcoming earnings report this week:

WAT

Analyst Ratings: There are eight out of 13 analysts surveyed (61.5%) rating Waters a buy.

Key Stats:

After experiencing income drops the past three quarters, the company is hoping to use this earnings announcement to rebound. Net income fell 6.2% in the first quarter, by 2.3% in the second quarter and again in the third quarter.

On the top line, the company is looking to rebound after a revenue drop last quarter. Revenue rose 0.9% in the the second quarter after dropping in the third quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 2.78 last quarter. Having a ratio above 2:1 is usually considered a good indicator of a company’s liquidity and ability to meet creditor demands. The company regressed in this liquidity measure from 2.86 in the second quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 6.4% to $767.6 million while assets rose 3.5% to $2.14 billion.

Wall St. Revenue Expectations: Analysts predict a decline of 0% in revenue from the year-earlier quarter to $521.3 million.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute — click here and get our CHEAT SHEET stock picks now.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)