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Valued at a market cap of $29.9 billion, Xylem Inc. (XYL) designs, manufactures, and services engineered products and solutions for utility, industrial, residential, and commercial building services settings. The Washington, DC-based company is one of the leading providers of water solutions worldwide and is involved in the full water-process cycle, including collection, distribution, and return of water to the environment.
Companies valued at $10 billion or more are typically classified as “large-cap stocks,” and Xylem fits the label perfectly, with its market cap exceeding this threshold. It is a leading global water technology company specializing in innovative solutions for water and wastewater management. XYL has a robust global presence and benefits from increasing demand for clean water, efficient water management, and climate resilience. Its strategic acquisitions, such as the merger with Evoqua Water Technologies, further enhance its market position and expand its capabilities in water treatment and industrial applications.
This water technology company is currently trading 17.2% below its 52-week high of $146.08, reached on May 21, 2024. Shares of Xylem have gained 3.4% over the past three months, outpacing the broader Dow Jones Industrials Average’s ($DOWI) 1.8% loss during the same time frame.
Moreover, on a YTD basis, shares of Xylem are up 4.2%, compared to DOWI’s 2.3% fall. However, in the longer term, XYL has declined nearly 5.2% over the past 52 weeks, underperforming DOWI’s 7.2% rise.
Xylem has been trading below its 200-day moving average since late October 2024, with slight fluctuations, and began trading under its 50-day moving average in mid-March.
On Feb. 4, shares of Xylem surged 5.2% after its better-than-expected Q4 earnings release. The company reported adjusted EPS of $1.18, exceeding Wall Street’s expectations of $1.12 and marking a 19.2% increase compared to the same quarter last year. Additionally, revenue grew 6.5% year-over-year to $2.3 billion, surpassing consensus estimates by 3.7%. Adding to the positives, adjusted operating income rose 20.4% year-over-year to $377 million. The robust performance was driven by solid order growth across all business segments, reinforcing investor confidence in the company's financial strength and growth trajectory.
Xylem has lagged behind its rival, Franklin Electric Co., Inc.’s (FELE) 2.3% decline over the past 52 weeks but has outpaced FELE’s 1.7% rise on a YTD basis.
Given XYL’s recent outperformance relative to the Dow, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 17 analysts covering it, and the mean price target of $148.50 suggests a 22.8% premium to its current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
