We expect Waters Corporation WAT to beat earnings expectations when it reports first-quarter 2016 results, before the opening bell, on Apr 26. In the last reported quarter, Waters Corp. posted a positive earnings surprise of 0.5%. The company boasts a solid earnings track record lately, with the company beating earnings estimates in each of the trailing four quarters. The average earnings surprise over the last four quarters is 6.3%. We expect the company to continue its upbeat performance in the to-be reported quarter. Why a Likely Positive Surprise? Our proven model shows that Waters Corp. is likely to beat earnings because it has the right combination of two key ingredients. Zacks ESP: The Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, stands at +1.63%. This is a very meaningful and leading indicator of a likely earnings surprise. Zacks Rank: Waters Corp. carries a Zacks Rank #2 (Buy). Note that stocks with a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 have a significantly higher chance of beating earnings estimates. Meanwhile, Sell-rated stocks (#4 and #5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions. The combination of Waters Corp.’s Zacks Rank #2 and ESP of +1.63% makes us confident of an earnings beat in the upcoming report. Growth Factors This Past Quarter Waters Corp.’s leading position in the high-performance liquid chromatography and mass spectrometry markets is its key strength that has acted as a strong revenue driver over the past few quarters. The company expects its pharmaceutical business to generate healthy profits for the quarter under review as well. As liquid chromatography is used in a variety of applications including drug discovery, development, quality control of drug products, therapeutic drug monitoring, proteomics, metabolomics, environmental analysis, and food analysis, Waters Corp. stands to benefit significantly from this business. As a matter of fact, Waters Corp.’s exposure in the pharma/biotech industry is primarily in regulated commercial lab environments, where demand is non-discretionary and not prone to cyclicality. This cushions the company from the vagaries of client spending thereby favoring financial performance. Moreover, the company has also been constantly expanding its technological and business portfolio through its acquisition strategy. In this regard, we believe previously acquired businesses like ElectroForce Group, which specializes in manufacturing mechanical testing systems based on a proprietary electromagnetic motor technology, are expected to be conducive to first-quarter 2016 results. In addition, innovative product launches has always been Waters Corp.’s strong suite that has fuelled top-line performance. Steady traction of some of the previously launched products by the company including CORTECS C8 and CORTECS Phenyl, Waters ProteinWorks Digest Kits, Oasis PRiME HLB, Discovery DSC 2500, DSC 250 and DSC 25 are expected to drive the first-quarter results. Also, the recently upgraded REIMS research system and revamped portfolio of CORTECS Solid-Core LC Columns are expected to widen the customer base of the company going forward. Despite these positives, exchange rate volatility and escalating debt levels and interest expenses may thwart the growth momentum at the company to some extent. Stocks That Warrant a Look Here are some companies that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this quarter: Spirit AeroSystems Holdings, Inc. SPR has an Earnings ESP of +6.60% and a Zacks Rank #2. The company will report first-quarter 2016 results on Apr 29. Essex Property Trust Inc. ESS has an Earnings ESP of +1.14% and a Zacks Rank #2. The company will report first-quarter 2016 results on Apr 28. Taubman Centers, Inc. TCO has an Earnings ESP of +3.53% and a Zacks Rank #3. The company will release first-quarter 2016 results on May 2. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPIRIT AEROSYS (SPR): Free Stock Analysis Report WATERS CORP (WAT): Free Stock Analysis Report TAUBMAN CENTERS (TCO): Free Stock Analysis Report ESSEX PPTY TR (ESS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research