Xylem Inc. (XYL) AI Stock Analysis

Xylem Inc. specializes in engineered solutions and products tailored for water and wastewater applications globally. The company operates through three segments: Water Infrastructure, Applied Water, and Measurement & Control Solutions. Water Infrastructure provides pumps, controls, filtration systems, and dewatering equipment under brands such as Flygt, Godwin, and Sanitaire. Applied Water supplies pumps, valves, heat exchangers, and control systems under brands including Goulds Water Technology and Bell & Gossett for residential, commercial, and industrial settings. Measurement & Control Solutions offers smart meters, communication devices, and software services like cloud-based analytics, leak detection, and remote monitoring.

Xylem's revenue increased from $5.20B in FY2021 to $9.04B in FY2025, reflecting a 5-year revenue CAGR of 13.1%. Annual revenue growth reached 33.4% in FY2023 and 16.3% in FY2024 before moderating to 5.5% in FY2025. Gross margin expanded to 38.5% in FY2025, while operating margin rose to 13.5%. Net income grew from $427.0M in FY2021 to $957.0M in FY2025, with annual EPS climbing from $2.48 to $5.08. Over the trailing twelve months ending June 30, 2026, revenue was $9.13B with an operating margin of 17.0%. In the latest quarter, quarterly revenue grew 1.5% year-over-year, while quarterly earnings grew 19.5%.

As of June 30, 2026, Xylem held $1.28B in cash and short-term investments against total debt of $3.06B, resulting in net debt of $1.78B. The company reported total assets of $17.34B and shareholders' equity of $10.42B, with a current ratio of 1.61 and a debt-to-equity ratio of 0.29. In FY2025, operating cash flow was $1.24B and free cash flow was $910.0M. Capital expenditures totaled $331.0M, while Xylem returned capital via $391.0M in dividends paid and $15.0M in share buybacks.

At $104.05 per share on October 16, 2026, Xylem had a market capitalization of $24.29B and an enterprise value of $27.15B. The stock trades at a trailing P/E of 24.8x and a forward P/E of 17.4x, both below the median of its S&P 500 Industrials peers at 28.5x and 20.7x, respectively. Its EV/EBITDA of 14.6x is also lower than the peer median of 17.7x. Over the past year, Xylem's shares fell 27.2%, underperforming the S&P 500 (SPY) return of 16.8%. Over five years, the stock dropped 11.2% compared to an 83.0% gain for the index.

Xylem pays a quarterly dividend with an annualized forward rate of $1.72, representing a dividend yield of 1.65%. The company has paid dividends for 16 consecutive years, supported by a 5-year annualized dividend growth rate of 9.0%. Its payout ratio stands at 31.5%, and the last ex-dividend date was August 27, 2026.

Consensus ratings include 10 Strong Buy, 4 Buy, and 7 Hold recommendations, with zero Sell or Strong Sell ratings. Analysts have set a mean price target of $145.00, representing upside of 39.4% from the last close of $104.05. For the fiscal year ending December 31, 2026, consensus estimates project EPS of $5.65 on revenue of $9.19B. Xylem has exceeded EPS estimates in each of the last 4 quarters, and its next earnings release is scheduled for October 27, 2026.

This page is an AI-written research summary of Xylem Inc. (XYL). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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