Xylem Inc. (XYL)
Industrials · NYSE · US
Fundamentals
Valuation and ratings
Xylem Inc. trades at $125.30, close to the $121.60 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 50 out of 100, which is a moat, but not a deep one. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 30.2 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Xylem Inc.
Xylem Inc., together with its subsidiaries, engages in the design, manufacture, and servicing of engineered products and solutions for utility, industrial, and residential and commercial building services settings worldwide. It operates through Water Infrastructure; Applied Water; Measurement and Control Solutions; and Water Solutions and Services segments. The company offers water, wastewater, and storm water pumps and controls and systems; filtration, disinfection, and biological treatment equipment under the Flygt, Ionpure, Leopold, Neptune Benson, Sanitare, Wallace & Tiernan, and Wedeco brands; and pumps, valves, heat exchangers, controls, and dispensing equipment used for water and focuses on the residential, commercial and industrial markets under the Rule, Bell & Gossett, Flojet, Goulds Water Technology, Jabsco, and Lowara brands. It also provides smart meters, network communication devices, data analytics, test instruments, controls, sensor devices, software and managed services, critical infrastructure services, cloud-based analytics, and remote monitoring and data management under the Ebro, Sensus, Sentec, Smith Blair, WTW, YSI, and Xylem Vue brands. In addition, the company offers preventative maintenance services, rapid response mobile services, digitally enabled/outsourced solutions, process and wastewater treatment systems, environmental remediation, odor and corrosion control, filtration, reverse osmosis, continuous deionization, and mobile dewatering equipment and rental services; and municipal services comprising odor and corrosion control services, as well as condition assessment and asset management, and pressure monitoring solutions under the Grindex, Mar Cor, and Godwin brands. Xylem Inc. was formerly known as ITT WCO, Inc. and changed its name to Xylem Inc. in July 2011. The company was incorporated in 2011 and is headquartered in Washington, District Of Columbia.
XYL passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
5 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Impax Asset Management, Impax Asset Management Group plc$547.97M · 3.8% of book
- Renaissance Technologies, RENAISSANCE TECHNOLOGIES LLC$94.62M · 0.1% of book
- Marshall Wace, MARSHALL WACE, LLP$88.64M · 0.1% of book
- D. E. Shaw, D. E. Shaw & Co., Inc.$76.73M · 0.1% of book
- Parnassus Investments, PARNASSUS INVESTMENTS, LLC$63.95M · 0.2% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Xylem Inc. (XYL) undervalued?
Against our discounted cash flow estimate of $121.60, XYL at $125.30 is 3% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own XYL?
5 of the institutions we track reported a position in XYL in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is XYL's P/E ratio?
XYL trades at 30.2 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for XYL, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.