XYLEM INC (XYL) Stock Fundamental Analysis
NYSE:XYL - New York Stock Exchange, Inc. - US98419M1009 - Common Stock - Currency: USD
Taking everything into account, XYL scores 5 out of 10 in our fundamental rating. XYL was compared to 128 industry peers in the Machinery industry. Both the profitability and the financial health of XYL get a neutral evaluation. Nothing too spectacular is happening here. XYL is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
XYL had positive earnings in the past year.
In the past year XYL had a positive cash flow from operations.
XYL had positive earnings in each of the past 5 years.
XYL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of XYL (5.47%) is better than 60.16% of its industry peers.
The Return On Equity of XYL (8.38%) is comparable to the rest of the industry.
XYL's Return On Invested Capital of 6.82% is in line compared to the rest of the industry. XYL outperforms 50.78% of its industry peers.
The Average Return On Invested Capital over the past 3 years for XYL is below the industry average of 10.31%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.47% | ||
| ROE | 8.38% | ||
| ROIC | 6.82% |
ROA(3y)4.55%
ROA(5y)4.34%
ROE(3y)8.17%
ROE(5y)9.27%
ROIC(3y)6.95%
ROIC(5y)7%
1.3 Margins
Looking at the Profit Margin, with a value of 10.54%, XYL is in the better half of the industry, outperforming 71.88% of the companies in the same industry.
XYL's Profit Margin has improved in the last couple of years.
XYL has a better Operating Margin (12.84%) than 64.84% of its industry peers.
XYL's Operating Margin has been stable in the last couple of years.
XYL has a Gross Margin of 37.54%. This is in the better half of the industry: XYL outperforms 68.75% of its industry peers.
In the last couple of years the Gross Margin of XYL has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.84% | ||
| PM (TTM) | 10.54% | ||
| GM | 37.54% |
OM growth 3Y3.16%
OM growth 5Y-1.19%
PM growth 3Y8.14%
PM growth 5Y6.35%
GM growth 3Y-0.44%
GM growth 5Y-0.76%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so XYL is destroying value.
The number of shares outstanding for XYL has been increased compared to 1 year ago.
The number of shares outstanding for XYL has been increased compared to 5 years ago.
The debt/assets ratio for XYL has been reduced compared to a year ago.
2.2 Solvency
XYL has an Altman-Z score of 4.34. This indicates that XYL is financially healthy and has little risk of bankruptcy at the moment.
With a decent Altman-Z score value of 4.34, XYL is doing good in the industry, outperforming 70.31% of the companies in the same industry.
The Debt to FCF ratio of XYL is 2.27, which is a good value as it means it would take XYL, 2.27 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.27, XYL is doing good in the industry, outperforming 73.44% of the companies in the same industry.
A Debt/Equity ratio of 0.18 indicates that XYL is not too dependend on debt financing.
XYL has a better Debt to Equity ratio (0.18) than 74.22% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 2.27 | ||
| Altman-Z | 4.34 |
ROIC/WACC0.65
WACC10.44%
2.3 Liquidity
A Current Ratio of 1.89 indicates that XYL should not have too much problems paying its short term obligations.
XYL has a Current ratio of 1.89. This is comparable to the rest of the industry: XYL outperforms 40.63% of its industry peers.
XYL has a Quick Ratio of 1.41. This is a normal value and indicates that XYL is financially healthy and should not expect problems in meeting its short term obligations.
XYL has a Quick ratio of 1.41. This is in the better half of the industry: XYL outperforms 60.94% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.89 | ||
| Quick Ratio | 1.41 |
3. Growth
3.1 Past
XYL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.25%, which is quite good.
The Earnings Per Share has been growing slightly by 7.22% on average over the past years.
XYL shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.16%.
XYL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.28% yearly.
EPS 1Y (TTM)14.25%
EPS 3Y19.95%
EPS 5Y7.22%
EPS Q2Q%14.44%
Revenue 1Y (TTM)8.16%
Revenue growth 3Y18.12%
Revenue growth 5Y10.28%
Sales Q2Q%1.77%
3.2 Future
Based on estimates for the next years, XYL will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.53% on average per year.
The Revenue is expected to grow by 5.47% on average over the next years.
EPS Next Y8.89%
EPS Next 2Y10.47%
EPS Next 3Y10.18%
EPS Next 5Y9.53%
Revenue Next Year3.01%
Revenue Next 2Y3.94%
Revenue Next 3Y4.59%
Revenue Next 5Y5.47%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 28.41 indicates a quite expensive valuation of XYL.
Based on the Price/Earnings ratio, XYL is valued a bit more expensive than 61.72% of the companies in the same industry.
XYL is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 25.91, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 23.98, the valuation of XYL can be described as rather expensive.
Based on the Price/Forward Earnings ratio, XYL is valued a bit more expensive than the industry average as 61.72% of the companies are valued more cheaply.
When comparing the Price/Forward Earnings ratio of XYL to the average of the S&P500 Index (21.85), we can say XYL is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.41 | ||
| Fwd PE | 23.98 |
4.2 Price Multiples
61.72% of the companies in the same industry are cheaper than XYL, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, XYL is valued a bit more expensive than 60.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.29 | ||
| EV/EBITDA | 18.8 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates XYL does not grow enough to justify the current Price/Earnings ratio.
XYL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.2
PEG (5Y)3.93
EPS Next 2Y10.47%
EPS Next 3Y10.18%
5. Dividend
5.1 Amount
XYL has a Yearly Dividend Yield of 1.26%. Purely for dividend investing, there may be better candidates out there.
XYL's Dividend Yield is a higher than the industry average which is at 1.83.
With a Dividend Yield of 1.26, XYL pays less dividend than the S&P500 average, which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.26% |
5.2 History
On average, the dividend of XYL grows each year by 8.36%, which is quite nice.
XYL has been paying a dividend for at least 10 years, so it has a reliable track record.
XYL has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)8.36%
Div Incr Years13
Div Non Decr Years13
5.3 Sustainability
39.74% of the earnings are spent on dividend by XYL. This is a low number and sustainable payout ratio.
The dividend of XYL is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP39.74%
EPS Next 2Y10.47%
EPS Next 3Y10.18%
125.27
-0.39 (-0.31%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners96.3%
Inst Owner Change1.23%
Ins Owners0.23%
Ins Owner Change1.38%
Market Cap30.48B
Analysts80
Price Target141.21 (12.72%)
Short Float %1.28%
Short Ratio1.63
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.26% |
Yearly Dividend1.44
Dividend Growth(5Y)8.36%
DP39.74%
Div Incr Years13
Div Non Decr Years13
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.39%
Min EPS beat(2)3.8%
Max EPS beat(2)6.98%
EPS beat(4)3
Avg EPS beat(4)3.09%
Min EPS beat(4)-0.98%
Max EPS beat(4)6.98%
EPS beat(8)7
Avg EPS beat(8)6.59%
EPS beat(12)11
Avg EPS beat(12)10.27%
EPS beat(16)15
Avg EPS beat(16)9.26%
Revenue beat(2)2
Avg Revenue beat(2)1.4%
Min Revenue beat(2)0.44%
Max Revenue beat(2)2.36%
Revenue beat(4)3
Avg Revenue beat(4)-0.3%
Min Revenue beat(4)-4.15%
Max Revenue beat(4)2.36%
Revenue beat(8)7
Avg Revenue beat(8)1.07%
Revenue beat(12)11
Avg Revenue beat(12)2.12%
Revenue beat(16)13
Avg Revenue beat(16)1.67%
PT rev (1m)-5.37%
PT rev (3m)-4.67%
EPS NQ rev (1m)0.56%
EPS NQ rev (3m)0.79%
EPS NY rev (1m)-0.64%
EPS NY rev (3m)-0.79%
Revenue NQ rev (1m)0.54%
Revenue NQ rev (3m)0.77%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-1.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.41 | ||
| Fwd PE | 23.98 | ||
| P/S | 3.55 | ||
| P/FCF | 34.29 | ||
| P/OCF | 25.26 | ||
| P/B | 2.82 | ||
| P/tB | 72.07 | ||
| EV/EBITDA | 18.8 |
EPS(TTM)4.41
EY3.52%
EPS(NY)5.22
Fwd EY4.17%
FCF(TTM)3.65
FCFY2.92%
OCF(TTM)4.96
OCFY3.96%
SpS35.33
BVpS44.45
TBVpS1.74
PEG (NY)3.2
PEG (5Y)3.93
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.47% | ||
| ROE | 8.38% | ||
| ROCE | 7.67% | ||
| ROIC | 6.82% | ||
| ROICexc | 7.36% | ||
| ROICexgc | 33.37% | ||
| OM | 12.84% | ||
| PM (TTM) | 10.54% | ||
| GM | 37.54% | ||
| FCFM | 10.34% |
ROA(3y)4.55%
ROA(5y)4.34%
ROE(3y)8.17%
ROE(5y)9.27%
ROIC(3y)6.95%
ROIC(5y)7%
ROICexc(3y)7.8%
ROICexc(5y)8.39%
ROICexgc(3y)31.15%
ROICexgc(5y)33.93%
ROCE(3y)7.81%
ROCE(5y)7.88%
ROICexcg growth 3Y5.31%
ROICexcg growth 5Y-3.31%
ROICexc growth 3Y-8.41%
ROICexc growth 5Y-8.35%
OM growth 3Y3.16%
OM growth 5Y-1.19%
PM growth 3Y8.14%
PM growth 5Y6.35%
GM growth 3Y-0.44%
GM growth 5Y-0.76%
F-Score8
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.18 | ||
| Debt/FCF | 2.27 | ||
| Debt/EBITDA | 1.18 | ||
| Cap/Depr | 55.5% | ||
| Cap/Sales | 3.7% | ||
| Interest Coverage | 16.73 | ||
| Cash Conversion | 71.97% | ||
| Profit Quality | 98.12% | ||
| Current Ratio | 1.89 | ||
| Quick Ratio | 1.41 | ||
| Altman-Z | 4.34 |
F-Score8
WACC10.44%
ROIC/WACC0.65
Cap/Depr(3y)69.14%
Cap/Depr(5y)73.04%
Cap/Sales(3y)3.73%
Cap/Sales(5y)3.79%
Profit Quality(3y)102.28%
Profit Quality(5y)127.3%
High Growth Momentum
Growth
EPS 1Y (TTM)14.25%
EPS 3Y19.95%
EPS 5Y7.22%
EPS Q2Q%14.44%
EPS Next Y8.89%
EPS Next 2Y10.47%
EPS Next 3Y10.18%
EPS Next 5Y9.53%
Revenue 1Y (TTM)8.16%
Revenue growth 3Y18.12%
Revenue growth 5Y10.28%
Sales Q2Q%1.77%
Revenue Next Year3.01%
Revenue Next 2Y3.94%
Revenue Next 3Y4.59%
Revenue Next 5Y5.47%
EBIT growth 1Y30.04%
EBIT growth 3Y21.85%
EBIT growth 5Y8.97%
EBIT Next Year40.85%
EBIT Next 3Y19.45%
EBIT Next 5Y13.1%
FCF growth 1Y97.56%
FCF growth 3Y41.3%
FCF growth 5Y8.72%
OCF growth 1Y83.43%
OCF growth 3Y32.52%
OCF growth 5Y8.33%