Xylem (NYSE:XYL) Releases Quarterly Earnings Results, Hits Estimates

Xylem (NYSE:XYL) posted its quarterly earnings results on Tuesday. The industrial products company reported $1.42 earnings per share for the quarter, hitting analysts’ consensus estimates of $1.42, FiscalAI reports. The firm had revenue of $2.40 billion for the quarter, compared to analyst estimates of $2.37 billion. Xylem had a net margin of 10.66% and a return on equity of 10.77%. Xylem’s quarterly revenue was up 6.3% on a year-over-year basis. During the same period in the previous year, the business posted $1.18 earnings per share. Xylem updated its FY 2026 guidance to 5.350-5.560 EPS.

Here are the key takeaways from Xylem’s conference call:

• Record 2025 results — Xylem closed the year with record revenue, EBITDA and EPS, expanded full-year EBITDA margin to 22.2%, a net debt/adjusted EBITDA of 0.2x, and a backlog of $4.6 billion.
• 2026 guidance calls for $9.1–$9.2 billion revenue (1%–3% reported; 2%–4% organic), EBITDA margin of 22.9%–23.3% (70–110 bps expansion) and EPS of $5.35–$5.60, reflecting continued margin improvement and profitable growth plans.
• Management will accelerate its 80/20 product/customer simplification, which creates an elevated ~2% one-year top-line headwind in 2026 as lower-quality revenues are intentionally walked away to raise long-term earnings quality.
• Near-term risks include project-timing variability in smart meters, pronounced weakness in China (notably Water Infrastructure and Applied Water), and quarter-to-quarter lumpiness in WSS, pressuring Q1 and early‑2026 cadence.

Xylem Trading Down 7.9%

Shares of XYL stock opened at $129.17 on Wednesday. Xylem has a 1-year low of $100.47 and a 1-year high of $154.27. The firm has a market cap of $31.45 billion, a PE ratio of 33.21, a price-to-earnings-growth ratio of 1.99 and a beta of 1.17. The company has a 50-day moving average of $139.27 and a two-hundred day moving average of $142.22. The company has a debt-to-equity ratio of 0.17, a current ratio of 1.96 and a quick ratio of 1.50.

Xylem Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Tuesday, March 24th. Shareholders of record on Tuesday, February 24th will be paid a dividend of $0.43 per share. This represents a $1.72 annualized dividend and a yield of 1.3%. This is a boost from Xylem’s previous quarterly dividend of $0.40. The ex-dividend date of this dividend is Tuesday, February 24th. Xylem’s payout ratio is 41.13%.

Hedge Funds Weigh In On Xylem

A number of hedge funds have recently made changes to their positions in the stock. Wexford Capital LP purchased a new stake in Xylem in the third quarter valued at approximately $27,000. FWL Investment Management LLC purchased a new position in shares of Xylem during the second quarter worth $43,000. Johnson Financial Group Inc. acquired a new stake in shares of Xylem in the third quarter valued at $77,000. State of Wyoming purchased a new stake in shares of Xylem in the 2nd quarter valued at $89,000. Finally, MUFG Securities EMEA plc acquired a new position in Xylem during the 2nd quarter worth about $93,000. Hedge funds and other institutional investors own 87.96% of the company’s stock.

Xylem News Summary

Here are the key news stories impacting Xylem this week:

• Positive Sentiment: Q4 results showed underlying strength — revenue of $2.40B topped estimates and adjusted EPS rose ~20% year/year on productivity and pricing, signaling solid execution. BusinessWire: Q4 & Full‑Year Results
• Positive Sentiment: Management raised the quarterly dividend to $0.43 (7.5% increase), payable March 24 — a shareholder‑friendly move that supports income investors. (Dividend announcement 2/10/26)
• Neutral Sentiment: Reported EPS of $1.42 matched consensus; revenue beat was modest. Analysts are parsing margin drivers and backlog details to judge sustainability. Zacks: Q4 Metrics
• Neutral Sentiment: The full Q4 earnings call transcript and slide deck are available for details on segment trends, margins and backlog — useful for models and guidance sensitivity. Seeking Alpha: Earnings Call Transcript
• Negative Sentiment: FY‑2026 guidance was cautious: EPS guidance of $5.35–$5.56 (consensus ~$5.54) and revenue guidance of $9.1–$9.2B (consensus ~$9.3B) — investors view the revenue guide as a miss and growth deceleration risk. Investing.com: Cautious 2026 Outlook
• Negative Sentiment: The cautious outlook triggered selling and commentary that the full‑year guide disappoints relative to prior expectations; multiple market pieces highlight the stock underperforming its peers today. MarketWatch: Stock Falls on Outlook
• Negative Sentiment: Short interest jumped ~47% in January to ~4.17M shares (≈1.7% of float), which can amplify downside moves and volatility while the market digests guidance and growth visibility. (Short‑interest data 1/30/26)

Analysts Set New Price Targets

XYL has been the subject of a number of analyst reports. William Blair started coverage on Xylem in a research report on Monday, January 26th. They issued an “outperform” rating for the company. Royal Bank Of Canada upped their target price on Xylem from $169.00 to $176.00 and gave the company an “outperform” rating in a report on Wednesday, October 29th. UBS Group raised their target price on Xylem from $168.00 to $175.00 and gave the stock a “buy” rating in a research note on Thursday, November 6th. Weiss Ratings reissued a “buy (b-)” rating on shares of Xylem in a research report on Monday, December 29th. Finally, Citigroup restated a “buy” rating on shares of Xylem in a research report on Wednesday. Nine equities research analysts have rated the stock with a Buy rating and four have issued a Hold rating to the stock. According to data from MarketBeat, the stock currently has an average rating of “Moderate Buy” and an average price target of $165.80.

Xylem Company Profile

Xylem Inc (NYSE: XYL) is a global water technology company that designs, manufactures and services engineered systems and equipment for the transport, treatment, testing and efficient use of water. Its product portfolio spans pumps and pumping systems, valves, filtration and disinfection equipment, sensors and analytical instruments, and digital solutions for monitoring and control of water infrastructure. Xylem serves the full water cycle with offerings for water and wastewater utilities, industrial customers, commercial and residential buildings, and agricultural applications.

The company was established as an independent publicly traded company in 2011 following a corporate spin-off from ITT Corporation and is headquartered in Rye Brook, New York.