Xylem (XYL) AI Stock Analysis

• Market Cap: $34.11B
• Dividend Yield: 1.15%
• Average Volume (3M): 1.03M
• Price to Earnings (P/E): 36.0
• Beta (1Y): 1.00
• Revenue Growth: 5.56%
• EPS Growth: 13.76%
• Country: US
• Employees: 23,000
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Machinery
• EPS (TTM): 1.37
• Shares Outstanding: 243,469,070
• 10 Day Avg. Volume: 824,886
• 30 Day Avg. Volume: 1,034,883
• PEG Ratio: 1.03
• Price to Book (P/B): 2.64
• Price to Sales (P/S): 3.29
• P/FCF Ratio: 29.88
• Enterprise Value/Market Cap: 1.09
• Enterprise Value/Revenue: 4.18
• Enterprise Value/Gross Profit: 10.92
• Enterprise Value/Ebitda: 20.71
• 1Y Price Target: $167.50
• Price Target Upside: 19.57% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 13
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 79 Outperform
• Price Target: $172.00 ▲(22.78% Upside)

Xylem's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. Technical analysis supports a bullish outlook, though caution is advised due to overbought signals. Valuation concerns slightly temper the overall score, but the company's strategic initiatives and raised guidance provide confidence in future growth.

Positive Factors

Revenue Growth

Xylem's raised revenue guidance indicates strong market demand and effective business strategies, supporting long-term growth prospects.

Margin Expansion

Improving margins reflect operational efficiency and cost management, enhancing profitability and financial stability over time.

Partnership with Amazon

The partnership with Amazon enhances Xylem's technological capabilities and market reach, supporting sustainable growth and innovation.

Negative Factors

Order Decline

Declining orders, particularly in China, may signal weakening demand, potentially impacting future revenue and growth momentum.

Challenges in China

Economic challenges in China could hinder Xylem's growth in a key market, affecting overall performance and strategic objectives.

Tariff Impact

Tariffs could increase costs and pressure margins, impacting profitability and competitive positioning in affected markets.

Xylem Business Overview & Revenue Model

Company Description

Xylem Inc., together with its subsidiaries, engages in the design, manufacture, and servicing of engineered products and solutions for the water and wastewater applications in the United States, Europe, the Asia Pacific, and internationally. It operates through three segments: Water Infrastructure, Applied Water, and Measurement & Control Solutions. The Water Infrastructure segment offers various products, including water, storm water, and wastewater pumps; controls and systems; filtration, disinfection, and biological treatment equipment; and mobile dewatering equipment under the Flygt, Godwin, Wedeco, Sanitaire, Leopold, Wedeco, and Xylem Vue brand names for the transportation and treatment of water. The Applied Water segment provides pumps, valves, heat exchangers, controls, and dispensing equipment systems under the Goulds Water Technology, Bell & Gossett, A-C Fire Pump, Standard Xchange, Lowara, Jabsco, Xylem Vue and Flojet brand names for residential and commercial building services, and industrial water applications. The Measurement & Control Solutions segment provides smart meters, networked communication devices, and measurement and control technologies, as well as critical infrastructure technologies. It also offers software and services, including cloud-based analytics, remote monitoring and data management, leak detection, condition assessment, asset management, and pressure monitoring solutions, as well as testing equipment and managed services. This segment sells its products under the Pure, Sensus, Smith Blair, WTW, Xylem Vue, and YSI brand names. The company markets and sells its products through a network of direct sales force, resellers, distributors, and value-added solution providers. Xylem Inc. was formerly known as ITT WCO, Inc. and changed its name to Xylem Inc. in May 2011. The company. was incorporated in 2011 and is headquartered in Rye Brook, New York.

How the Company Makes Money

Xylem generates revenue through multiple streams, primarily from the sale of its water technology products and services. Key revenue streams include the sale of pumps, treatment equipment, and related services, as well as recurring revenue from maintenance contracts and spare parts. The company benefits from significant partnerships with municipalities and industries that require efficient water management solutions. Additionally, Xylem engages in research and development to innovate and enhance its product offerings, which helps maintain its competitive edge and drives growth in emerging markets and sectors focused on sustainability.

Xylem Financial Statement Overview

Summary

Xylem exhibits strong financial performance with consistent revenue and profit growth, efficient operations, and a solid balance sheet with low leverage. Cash flow generation is robust, supporting ongoing operations and potential investments. While the return on equity could be improved, the company's financial health is stable and well-positioned for future growth.

Income Statement

Xylem's income statement shows strong performance with consistent revenue growth, evidenced by a 1.89% increase in TTM (Trailing-Twelve-Months) revenue. The company maintains healthy profitability with a gross profit margin of 37.82% and a net profit margin of 10.75%. EBIT and EBITDA margins are also robust at 13.70% and 20.27%, respectively, indicating efficient operations and cost management.

Balance Sheet

The balance sheet reflects a solid financial position with a low debt-to-equity ratio of 0.18, suggesting prudent financial leverage. Return on equity is moderate at 8.58%, indicating effective use of equity to generate profits. The equity ratio stands at 64.77%, highlighting a strong equity base relative to total assets, which enhances financial stability.

Cash Flow

Xylem's cash flow statement is strong, with a 4.99% growth in free cash flow, demonstrating effective cash generation. The operating cash flow to net income ratio of 1.34 indicates robust cash conversion from earnings. The free cash flow to net income ratio of 0.72 further underscores the company's ability to generate cash relative to its net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	8.89B	8.56B	7.36B	5.52B	5.20B	4.88B
Gross Profit	3.40B	3.21B	2.72B	2.08B	1.98B	1.83B
EBITDA	1.79B	1.69B	1.12B	726.00M	832.00M	613.00M
Net Income	948.00M	890.00M	609.00M	355.00M	427.00M	254.00M
Balance Sheet
Total Assets	17.30B	16.49B	16.11B	7.95B	8.28B	8.75B
Cash, Cash Equivalents and Short-Term Investments	1.19B	1.12B	1.02B	944.00M	1.35B	1.88B
Total Debt	2.09B	2.13B	2.39B	1.95B	2.51B	3.15B
Total Liabilities	5.85B	5.62B	5.94B	4.45B	5.05B	5.77B
Stockholders Equity	11.21B	10.64B	10.17B	3.49B	3.22B	2.97B
Cash Flow
Free Cash Flow	925.00M	942.00M	566.00M	388.00M	330.00M	641.00M
Operating Cash Flow	1.27B	1.26B	837.00M	596.00M	538.00M	824.00M
Investing Cash Flow	-618.00M	-482.00M	-628.00M	-191.00M	-183.00M	-169.00M
Financing Cash Flow	-477.00M	-615.00M	-157.00M	-790.00M	-855.00M	473.00M

Xylem Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 140.09
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For XYL, the sentiment is Positive. The current price of 140.09 is above the 20-day moving average (MA) of 138.67, below the 50-day MA of 141.02, and above the 200-day MA of 134.26, indicating a neutral trend. The MACD of -0.07 indicates Negative momentum. The RSI at 52.10 is Neutral, neither overbought nor oversold. The STOCH value of 66.40 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for XYL.

Xylem Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FLS	79 Outperform	$9.55B	21.86	20.97%	1.17%	3.19%	69.89%
NDSN	79 Outperform	$14.88B	31.31	16.21%	1.64%	3.78%	4.85%
XYL	79 Outperform	$34.11B	36.04	8.70%	1.15%	5.56%	13.76%
WTS	77 Outperform	$9.68B	29.97	17.81%	0.70%	4.18%	16.05%
PNR	75 Outperform	$17.03B	26.41	17.97%	0.96%	0.83%	-1.32%
ITT	72 Outperform	$15.57B	30.07	17.85%	0.79%	8.01%	2.67%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%