UPDATE: JP Morgan Downgrades Waters to Neutral on Limited Upside Potential

JP Morgan reduced its rating on Waters

from Overweight to Neutral and reiterated its $90 price target. JP Morgan noted, "We are downgrading our rating on Waters (WAT) from Overweight to Neutral, given a near-peak margin structure (which is unlikely to improve meaningfully from current levels, in our view), increasing competitive dynamics, and above-peer valuation (>17x P/E). While we expect the company to return to mid-single digit growth in 2013 against an easy comp, we believe that other names within our coverage universe present more appealing risk-reward, particularly given the substantial premium valuation. We look to become more constructive on a pullback." Waters closed at $88.39 on Wednesday.