Waters Shares Gain Momentum on Merger Progress

Waters US9418481035

Analysts are updating their views on Waters Corporation following the company's recent regulatory filings, which mark significant progress in its planned merger. The submission of key documents to the U.S. Securities and Exchange Commission (SEC) has prompted several financial institutions to revise their financial models and ratings for the analytical instrument maker.

The merger process advanced substantially with two critical SEC filings in December. A Form S-4 was submitted on December 11, followed by a Form 425 filing on December 15. These documents, related to the business combination with a division of Becton, Dickinson and Company (BDX), represent formal steps toward completing the transaction. This regulatory progress has been the catalyst for a series of evaluations from investment banks.

Deutsche Bank confirmed its "Hold" rating on the stock today at 08:46 EST, adjusting its valuation parameters. This follows other recent analyst actions: Jefferies reaffirmed a "Buy" rating on December 17, Rothschild & Co. maintained its "Buy" on December 16, and Wells Fargo adjusted its assessment on December 15 following the initial business combination communication. Waters' stock was trading near $376.31 as the market digested these developments.

Strong Operational Performance Underpins Deal

Waters reported a robust operational performance for the third quarter of 2025, providing a solid foundation as it moves toward the merger.
- Revenue reached $800 million, an increase of 8% on a reported basis.
- Instrument sales grew by 6%, driven by demand for Liquid Chromatography (LC) and Mass Spectrometry (MS) systems.
- Non-GAAP earnings per share (EPS) were $3.40, a 16% rise from the $2.93 reported for the prior-year period.
- Recurring revenue from chemistry consumables and service rose by 9% in constant currency.
- The company's management raised its full-year 2025 constant-currency growth forecast in November to a range of 6.7% to 7.3%.

The company managed to offset approximately $10 million in net effects from international tariffs. Its adjusted operating margin stood at 30.3%, even as research and development expenditures increased by 11.7% year-over-year.

Strategic Rationale and Forward Look

The recently disclosed merger synergies are expected to bolster Waters' position in clinical diagnostics and bioprocessing. SEC documents indicate that specialized testing applications, such as analyses for GLP-1 therapies and PFAS monitoring, could contribute annual growth in the range of approximately 30 basis points.

With the Form S-4 now active, the next notable milestone is a shareholder vote to approve the deal. From a technical perspective, the stock is testing levels established after an upgrade by Wolfe Research on December 10. Among the 19 analysts covering Waters, the consensus recommendation remains "Moderate Buy."

Looking ahead, Waters is scheduled to release its fourth-quarter 2025 results in February 2026. Management has provided Q4 2025 non-GAAP EPS guidance of between $4.45 and $4.55, which would represent year-over-year growth of roughly 9% to 11%. The near-term events—the shareholder vote following the S-4 filing and the February report, which is expected to include the first integrated forecast for the combined entity—are viewed as central catalysts for the stock's future trajectory.