Xylem (XYL) AI Stock Analysis

• Market Cap: $25.45B
• Dividend Yield: 1.41%
• Average Volume (3M): 1.79M
• Price to Earnings (P/E): 28.6
• Beta (1Y): 1.24
• Revenue Growth: 16.23%
• EPS Growth: 34.42%
• Country: US
• Employees: 23,000
• Sector: Industrials
• Sector Strength: 63
• Industry: Industrial - Machinery
• EPS (TTM): 3.65
• Shares Outstanding: 243,349,470
• 10 Day Avg. Volume: 2,020,531
• 30 Day Avg. Volume: 1,786,736
• PEG Ratio: 0.83
• Price to Book (P/B): N/A
• Price to Sales (P/S): 3.36
• Price to Cash Flow (P/CF): 12.50
• P/FCF Ratio: 12.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $146.57
• Price Target Upside: 41.35% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

Xylem's overall stock score reflects its strong financial performance and positive earnings outlook, underpinned by strategic growth initiatives and successful integration efforts. While technical indicators and high valuation present some caution, the company's robust revenue growth and favorable guidance for 2025 suggest a promising future.

Positive Factors

Management Strategy

Management's 80/20 efforts are expected to be successful.

Operational Efficiency

80/20 program should continue increasing on-time delivery, which has increased ~500bps with another ~700bps to hit the target.

Order Growth

Strong order close with sights on 80/20 manifestation and resumption of growth in water meters.

Negative Factors

Earnings Guidance

The current forward earnings valuation is not seen as a great entry point.

Market Conditions

China still weak and not expected to flip to neutral in the near term.

Revenue Trends

Forward estimates likely don't have material upside, further near-term re-rating seems unlikely, and revenue/margin trends are decelerating.

Xylem Business Overview & Revenue Model

Company Description

Xylem Inc. (XYL) is a leading global water technology company committed to solving critical water and infrastructure challenges through innovative solutions. The company operates in the water infrastructure, applied water, and measurement and control solutions sectors, offering a wide range of products and services, including water and wastewater pumps, treatment and testing equipment, and smart metering technologies. Xylem serves a diverse customer base across industries such as utilities, industrial, commercial, and residential markets.

How the Company Makes Money

Xylem generates revenue through the sale of its water and wastewater products and services. The company's key revenue streams include the sale of pumps, valves, and controls for water infrastructure applications, as well as the provision of treatment and testing solutions for water and wastewater applications. Additionally, Xylem offers advanced metering and network technologies that enable water utilities to optimize resource management and efficiency. The company also benefits from strategic partnerships and collaborations with municipal and industrial customers, which help drive demand for its comprehensive solutions. Xylem's revenue is further supported by ongoing investments in research and development, allowing it to continuously innovate and offer state-of-the-art technologies to its global customer base.

Xylem Financial Statement Overview

Summary

Xylem demonstrates commendable financial performance with strong revenue growth and stable profitability. The balance sheet indicates low leverage risk with a solid equity base. Cash flow generation is robust, supporting operational and investment needs. However, missing data for 2024 limits a complete assessment of the company's most recent financial standing.

Income Statement

Xylem has demonstrated strong revenue growth over recent years, with the revenue increasing from $5.5 billion in 2022 to $7.36 billion in 2023, indicating a robust growth rate. The company maintains healthy margins, with a gross profit margin of 36.9% in 2023 and a solid net profit margin of 8.3%. The EBIT and EBITDA margins also reflect stable profitability. However, the lack of revenue data for 2024 limits a complete assessment of the latest performance.

Balance Sheet

Xylem's balance sheet shows a strong equity position with a debt-to-equity ratio of 0.23 in 2023, suggesting low financial leverage. The company's return on equity (ROE) is impressive at 6.0%, indicating efficient use of equity. However, the absence of total assets and equity data for 2024 restricts a full evaluation of the latest financial condition.

Cash Flow

The cash flow statements reveal a positive trend in free cash flow growth in 2023, with free cash flow increasing from $388 million in 2022 to $566 million. The operating cash flow to net income ratio is favorable, indicating strong cash generation relative to earnings. However, the cash flow data for 2024 is incomplete, preventing a comprehensive analysis for the most recent period.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
8.56B	7.36B	5.52B	5.20B	4.88B
	Gross Profit
3.21B	2.72B	2.08B	1.98B	1.83B
	EBIT
1.07B	652.00M	622.00M	585.00M	495.00M
	EBITDA
1.63B	1.15B	755.00M	853.00M	736.00M
	Net Income Common Stockholders
890.00M	609.00M	355.00M	427.00M	254.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.12B	1.02B	944.00M	1.35B	1.88B
	Total Assets
16.50B	16.11B	7.95B	8.28B	8.75B
	Total Debt
2.02B	2.39B	1.95B	2.44B	3.08B
	Net Debt
895.00M	1.37B	1.00B	1.09B	1.21B
	Total Liabilities
5.62B	5.94B	4.45B	5.05B	5.77B
	Stockholders Equity
10.64B	10.17B	3.49B	3.22B	2.97B
Cash Flow		Free Cash Flow
942.00M	566.00M	388.00M	330.00M	641.00M
	Operating Cash Flow
1.26B	837.00M	596.00M	538.00M	824.00M
	Investing Cash Flow
-482.00M	-628.00M	-191.00M	-183.00M	-169.00M
	Financing Cash Flow
-615.00M	-157.00M	-790.00M	-855.00M	473.00M

Xylem Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 103.69
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XYL, the sentiment is Negative. The current price of 103.69 is below the 20-day moving average (MA) of 117.96, below the 50-day MA of 124.01, and below the 200-day MA of 127.25, indicating a bearish trend. The MACD of -1.67 indicates Positive momentum. The RSI at 40.61 is Neutral, neither overbought nor oversold. The STOCH value of 40.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for XYL.

Xylem Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
XYL	74 Outperform	$25.45B	28.62	8.55%	1.41%	16.23%	34.42%
PNR	73 Outperform	$12.99B	21.04	18.45%	1.19%	-0.53%	0.13%
FELE	72 Outperform	$4.00B	22.64	14.53%	1.16%	-2.12%	-6.07%
WMS	72 Outperform	$7.84B	16.91	34.07%	0.63%	3.67%	-5.03%
VMI	68 Neutral	$5.32B	15.43	24.05%	0.93%	-2.38%	141.60%
AOS	63 Neutral	$8.90B	17.09	28.63%	2.13%	-0.90%	-1.69%
Sector *	62 Neutral	$7.24B	12.39	3.08%	3.39%	3.63%	-14.35%

Xylem Corporate Events

Xylem Appoints New Leader for Applied Water Segment

Xylem Inc., a leading global water solutions company, has appointed Meredith Emmerich as Senior Vice President and President of its Applied Water segment, effective October 21, 2024. Emmerich, with over 20 years of experience in smart building solutions, succeeds Franz Cerwinka, who will remain as a senior advisor until March 2025. Emmerich’s leadership aims to enhance sustainable growth and customer-centric solutions in industrial and commercial water management.