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Xylem Inc. (XYL), headquartered in Washington, D.C., is a global leader in water technology dedicated to addressing the world's most critical water challenges. With a market cap of $29.3 billion, the company provides advanced technologies and services for water management, treatment, and transportation, empowering communities and industries worldwide while fostering environmental stewardship and sustainable growth.
Companies with a market cap of $10 billion or more are classified as “large-cap stocks,” Xylem fits this category. Xylem delivers reliable and forward-thinking water technology solutions by combining advanced engineering, cutting-edge innovation, and a steadfast commitment to sustainability.
Shares of the water technology company have fallen 17.4% from their 52-week high of $146.08, hit on May 21. The stock is down 7.8% over the past three months, significantly underperforming the broader Nasdaq Composite’s ($NASX) 12.7% gain during the same time frame.
Over the long term, XYL has achieved a YTD gain of 5.5% and returned 10.5% over the past 52 weeks. In comparison, the NASX has risen 32.7% in 2024 and 35.2% over the past year.
Since late October, XYL has been trading below its 200-day and 50-day moving averages, signaling a bearish trend.
On Oct. 31, Xylem's shares fell 6.5% after the company reported mixed Q3 results. Revenue of $2.1 billion rose 1.3% year over year but missed Wall Street estimates by 3.2%, while adjusted EPS of $1.11 met expectations. EBITDA came in slightly below forecasts at $447 million.
Despite a consistent gross margin of 37.3%, the operating margin improved significantly to 13.3% from 9.2% in the prior year, reflecting better operational efficiency.
The company lowered its full-year revenue guidance to $8.5 billion at the midpoint, a modest 0.6% reduction, but maintained its adjusted EPS guidance at $4.23.
Xylem's competitor, Parker Hannifin Corporation (PH), has outperformed XYL over the past year. Shares of Parker Hannifin gained 45.8% in 2024 and returned 10.6% over the past 52 weeks.
Wall Street analysts hold a cautiously optimistic view of XYL's prospects. Of the 18 analysts covering the stock, the consensus rating is “Moderate Buy.” Its mean price target of $152.07 indicates a potential upside of 26.1% from its current level.
