WAT Should I Buy
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BUY now. WAT is trading near key support (S1 ~372 / S2 ~364) after a pullback, is technically oversold in the very short term (RSI_6 ~20), and has clear near-term, event-driven catalysts (BD spin-off record date Feb 5 and merger close expected Feb 9) that can attract incremental flows. Wall Street sentiment has turned more constructive with multiple bullish initiations/upgrades and higher price targets ($415–$480 range). The main counterweight is weak near-term momentum (bearish MACD) and notable hedge-fund selling, but given the proximity to support and the upcoming catalysts, the risk/reward favors initiating a position now rather than waiting.
Trend/momentum is currently bearish but stretched: MACD histogram is negative (-2.647) and expanding lower, indicating downside momentum remains in control. However, RSI_6 at ~20 suggests short-term oversold conditions that often precede a bounce. Price (370.72) is below the pivot (385.16) and just under S1 (372.179), with the next support at S2 (364.16). Upside resistance levels to clear are 385 (pivot) then 398 (R1). Moving averages are converging, implying the stock may be transitioning toward a base rather than continuing a strong trend move. Pattern-based projection is mildly positive over 1M (+3.15%) despite a slightly negative next-day bias.
Event-driven catalyst: BD announced spin-off record date Feb 5, 2026, with the Waters merger expected to complete Feb 9, 2026 (also aligned with Waters’ Q4 2025 results timing).
Shareholder support: ~99% of Waters shareholders approved issuing stock to BD shareholders, reducing deal-completion uncertainty.
Analyst sentiment improving: multiple recent bullish initiations/upgrades with targets well above the current price (e.g., Guggenheim $440; Wolfe $
and constructive commentary on end-market inflection into 2026.
Momentum/technical pressure: bearish MACD expansion and price below pivot indicate sellers still control the near-term trend.
Hedge fund flow: hedge funds are reportedly selling, with selling amount up ~125.8% over the last quarter.
Fundamental mix: despite revenue growth, profitability declined YoY in the latest reported quarter (EPS and net income down), which can cap multiple expansion until margins re-accelerate.
Latest quarter: 2025/Q3. Revenue grew to $799.9M (+8.05% YoY), showing demand resilience/improvement. However, net income fell to $148.9M (-7.79% YoY) and EPS declined to $2.50 (-7.75% YoY), with gross margin slightly lower at 57.51% (-0.26% YoY). Net takeaway: top-line trend is positive, but margin/earnings leverage lagged—important to watch into the upcoming Q4 2025 print (scheduled 2026-02-12 pre-market).
Recent trend is clearly improving: multiple initiations and an upgrade since Nov–Jan, alongside higher price targets. Key actions: Wolfe upgraded to Outperform with a $480 PT (Dec 10); Wells Fargo raised PT to $415 while staying Equal Weight (Dec 15); Guggenheim initiated Buy with $440 PT (Jan 6); William Blair initiated Outperform (Jan 5). Wall Street pros: expectation of sector/end-market improvement into 2026, strong free cash flow profile, and upside to synergy/operating targets around the BD deal. Cons: valuation sensitivity and execution risk around integration/synergies (reflected by some Neutral/Hold stances). Politician/congress checks: no recent congress trading data available; insiders are reported neutral with no notable recent trend.
