Jefferies analyst Tycho Peterson has maintained their bullish stance on WAT stock, giving a Buy rating on July 11.
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Tycho Peterson has given his Buy rating due to a combination of factors surrounding Waters’ strategic merger with Becton Dickinson’s Life Science business. The merger, structured as a Reverse Merger Trust, is set to create a significant entity with $6.5 billion in revenue and $2 billion in adjusted EBITDA by 2025. This strategic move is expected to drive mid- to high-single-digit growth through 2030, with a focus on expanding the total addressable market and maintaining an attractive margin profile.
Despite potential short-term trading down due to the complexity and size of the deal, Peterson sees long-term benefits in terms of scale and credibility, particularly given the successful track record of leadership in similar large-scale integrations. The anticipated synergies, including cost savings and revenue enhancements, are expected to be accretive from the first year post-close, making the investment attractive. Peterson’s confidence is further bolstered by the leadership’s past success in executing large deals, such as the $17 billion Sigma-Aldrich acquisition at Merck KGaA, which adds credibility to the integration process.
In another report released on July 11, Scotiabank also maintained a Buy rating on the stock with a $465.00 price target.