Xylem Inc. research snapshot
XYL AI stock analysis as of the August 2, 2026 data cutoff reads Xylem Inc. as a high-quality water technology and services company whose long-term demand drivers are strengthening while near-term growth is held back by China weakness and electric metering delays. The stock closed at $116.97 on July 31, 2026, with a market capitalization near $27.31 billion, re-verified as $116.97 times 233.49 million shares with a 0.00% deviation. The Q2 2026 report, released July 28, 2026, delivered record adjusted EPS of $1.46 up 16%, revenue of $2.34 billion up about 1%, an EBITDA margin of 23.3% up 150 basis points, and ending backlog of $5.3 billion with book-to-bill above one. Management raised the full-year 2026 adjusted EPS range to $5.55 to $5.70 from $5.35 to $5.60 and lifted the EBITDA margin outlook to 23.1% to 23.5%, while narrowing organic growth to 2% to 3% because of electric metering project delays. The AI and data center theme is real but small: data center revenue is expected to grow about 200% this year and reach about 2% of total revenue by year end. Offsetting this is a 27% decline in China revenue, a lowered MCS outlook, roughly $1.65 billion of net debt on the June 30, 2026 balance sheet, and a valuation near 27.8x trailing earnings and 20x forward earnings. This page presents a scenario framework, not a certain price prediction, and is for information only.
Current price
$116.97
Market cap
$27.31 billion
AI score
71 / 100
Rating
High-quality water technology compounder at a fair multiple with near-term growth headwinds
Trend status
Neutral to mixed: above the 50-day average but below the 200-day average
Data cutoff (updated monthly)
August 4, 2026
Informational use only. This page is not investment advice.
| Dimension | Conclusion | Confidence |
|---|---|---|
| Business quality | Xylem sells pumps, transport, treatment, disinfection, measurement, smart metering, analytics, digital software, and outsourced water services into utility, industrial, residential, and commercial building markets, with a balanced four-segment structure. | High |
| Moat | The moat comes from installed base, critical water system trust, engineering and application expertise, long outsourcing contracts such as the record Dow agreement, channel reach, service relationships, and digital platforms such as Vue. | Medium-high |
| Management | Matthew Pine, CEO since 2024, is running a simplification and 80/20 agenda with visible results: record Q2 2026 adjusted EPS, an EBITDA margin up 150 basis points, share repurchases, and portfolio actions including TriOS, WaterFleet, and Baycom. | Medium-high |
| Financial trend | TTM revenue was $9.13 billion up 4.54%, TTM net income $1.02 billion with EPS of $4.20, gross margin 39.24%, operating margin 14.48%, and TTM free cash flow of $960 million, with Q2 2026 EBITDA margin of 23.3%. | High |
| Valuation | At $116.97, XYL trades near 27.83x trailing EPS, 20.01x forward earnings, 2.99x sales, 2.62x book value, and 28.51x free cash flow, with an EV/EBITDA of 15.42 and a 1.47% dividend yield. | High |
| Technical trend | The stock closed above its 50-day average near $114.95 but below its 200-day average near $128.35, with RSI near 47 and ADX near 27, so the medium-term trend is still under pressure. | Medium |
| Risk level | Key risks are the 27% China revenue decline, electric metering project delays, MCS outlook cuts, weak near-term organic growth of 2% to 3%, AI data center demand cyclicality, acquisition integration, and valuation compression in a premium industrial. | Medium-high |
| AI confidence | High for descriptive facts and cross-checked math that matched across StockAnalysis.com, SEC EDGAR XBRL, the Q2 2026 earnings release, and the earnings call transcript. Lower for forward return estimates because growth mix, China, and electric metering timing are uncertain. | High data confidence |
| Investment certainty | Medium certainty. The page gives a research framework and scenario ranges, not a buy or sell instruction. | Medium |
XYL AI stock forecast
The XYL AI stock forecast uses scenario math around the July 31, 2026 close of $116.97 and the FY2026 adjusted EPS consensus near $5.66. The three-scenario framework produced a bearish area near $102, a base area near $143, and a bullish area near $191 before dividends, using adjusted EPS growth of 4%, 8%, and 12% and exit multiples of 16x, 20x, and 24x over three years. These are scenarios, not price commitments.
$175 to $195
More likely if data center and high-growth industrial water demand scales, U.S. municipal and transport growth stays double digit, electric metering recovers, China stabilizes, and the market keeps XYL near a 22x to 24x forward multiple as adjusted EPS compounds in the low teens.
$130 to $155
More likely if Xylem compounds adjusted EPS at a mid single-digit to high single-digit rate, keeps the $5.55 to $5.70 2026 guidance on track, and investors hold the stock near an 18x to 20x forward multiple, consistent with the analyst average target of $153.41.
$95 to $110
More likely if China keeps shrinking, electric metering delays persist, organic growth stalls near 1% to 2%, data center wins slow, margins stop expanding, or the market compresses the multiple toward the 16x area implied by targets near $129 to $137.
XYL AI technical analysis
XYL AI technical analysis is neutral as of the August 2, 2026 data cutoff. The stock closed at $116.97 on July 31, 2026, above its 50-day moving average near $114.95 but below its 200-day moving average near $128.35, with the 20-day average near $120.13 overhead. The 14-day RSI near 47 and 14-day ADX near 27 point to a range without a strong directional trend, after a 52-week decline of about 10.4%.
| Level | Value | Why it matters |
|---|---|---|
| Current price | $116.97 | StockAnalysis.com real-time quote at the July 31, 2026 close; market cap math uses 233.49 million shares outstanding. |
| Immediate support | $114.90 to $115 | The 50-day moving average near $114.95 is the first support zone, and the stock closed just above it on July 31, 2026. |
| Deeper support | $105 to $106 | The 52-week low near $105.29 from the Barchart range is the main downside reference for a trend break. |
| Near resistance | $120 to $121 | The 5-day average near $120.21 and 20-day average near $120.13 cluster just above price and form the first overhead test. |
| Upper resistance | $128 to $129 | The 200-day moving average near $128.35 is the key trend gate. A sustained reclaim would shift the medium-term structure to constructive. |
| Moving averages | 20-day $120.13, 50-day $114.95, 100-day $117.18, 200-day $128.35 | Barchart reported these levels on July 31, 2026. Price is above the 50-day but below the 100-day and 200-day, a mixed structure. |
| Momentum | 14-day RSI near 47, 14-day ADX near 27 | Barchart showed RSI near 47.07 and ADX near 26.87 with +DI near 29.36 above -DI near 24.86, so short-term momentum is neutral to slightly positive but not trending. |
| Volume | About 2.1 million average shares | Barchart listed 20-day average volume near 2.10 million shares and StockAnalysis.com near 2.07 million, useful for checking whether a break of $120 or $128 is confirmed by participation. |
| Volatility | Elevated, near 36% historical | Barchart reported 14-day historical volatility near 36.2% and 9-day near 39.4%, so position sizing should account for larger swings around earnings and macro news. |
| Invalidation | Close below $114.95, then below $105 | A decisive close below the 50-day average near $114.95 would weaken the short setup. A close below the 52-week low near $105.29 would challenge the broader quality-industrial valuation case. |
XYL AI trading strategy
The XYL AI trading strategy is a rules-based research framework for trading and watching the water technology leader. It is not personal advice and should be paired with fresh chart data, filings, position sizing, and a defined invalidation level.
Watch for XYL to hold the $114.95 to $115 support area and then reclaim $120 and, more importantly, the 200-day average near $128.35 with improving volume, stable orders, and confirmation that 2026 guidance remains intact.
A failed reclaim of the 200-day average or a daily close below $114.95 should reduce confidence in the setup.
If XYL pulls back toward the $105 to $115 zone without a business thesis break, compare valuation, backlog, order trends, China commentary, and electric metering timing before treating the dip as attractive.
Do not average down solely because water and AI data center demand are durable themes. Define maximum loss and review the earnings multiple first.
Track Q3 2026 earnings, full-year revenue and adjusted EPS guidance, organic growth, segment orders, data center revenue, China, electric metering timing, EBITDA margin, free cash flow, debt, and acquisition integration.
Lower the rating if organic growth stalls while the stock keeps trading at a premium industrial multiple, or if margin expansion reverses.
Investment research summary
Customers pay Xylem because utilities, industrial operators, buildings, and communities need reliable water transport, treatment, measurement, analytics, and service support across the water cycle, and increasingly for the water that powers data centers, semiconductors, power, and mining.
Xylem has an installed base, engineering know-how, critical-system trust, channel reach, service relationships, smart metering capability, digital platforms, and a broader portfolio after Evoqua. Long outsourcing contracts such as the record Dow agreement and a 23-year, roughly $850 million outsourced water project add durability, but the moat is not immune to public budget cycles, China competition, or industrial demand swings.
The thesis can fail if China revenue keeps declining, electric metering delays turn permanent, data center water demand proves cyclical, organic growth stalls near 1%, margins stop expanding, acquisitions distract management, or investors overpay for a popular scarcity and AI water narrative.
Matthew Pine has been CEO since 2024 and has led Xylem through simplification, 80/20 portfolio discipline, margin expansion, opportunistic buybacks, and acquisitions in sensing and mobile water treatment. The monitoring question is whether growth can re-accelerate after the walkaway revenue and China headwinds fade.
Water scarcity, aging municipal systems, industrial water reuse, regulation, PFAS and emerging contaminant concerns, and AI data center water needs create long-term demand. Xylem calls data centers an early indicator of a larger AI ecosystem opportunity, with data center revenue expected up about 200% this year.
At $116.97, the stock trades near 28x trailing and 20x forward earnings, which is not extreme for a quality industrial but already prices in continued margin and EPS progress. Margin of safety improves if the price falls toward conservative scenario ranges without a deterioration in orders, margins, or cash flow.
Source-backed data
Every metric below includes a source and last verification date.
| Metric | Value | Source | Last verified |
|---|---|---|---|
| XYL price | $116.97 at the July 31, 2026 close | StockAnalysis.com real-time quote | August 2, 2026 |
| Market capitalization | $27.31 billion, computed as $116.97 x 233.49 million shares outstanding, 0.00% deviation | StockAnalysis.com quote and share statistics | August 2, 2026 |
| Share statistics | 233.49 million shares outstanding, down 0.70% year over year and 2.79% quarter over quarter, float of 232.84 million | StockAnalysis.com share statistics | August 2, 2026 |
| Q2 2026 revenue | $2.336 billion, up about 1% reported, versus consensus of about $2.34 billion | SEC EDGAR XBRL and Xylem Q2 2026 earnings release | July 28, 2026 |
| Q2 2026 adjusted results | Record adjusted EPS of $1.46 up 16%, revenue of $2.34 billion, EBITDA margin of 23.3% up 150 basis points | Xylem Q2 2026 earnings call | July 28, 2026 |
| Q2 2026 GAAP results | Net income of $263 million for the quarter and $456 million for the first half of 2026, per the Q2 2026 Form 10-Q | SEC EDGAR XBRL NetIncomeLoss | July 28, 2026 |
| Backlog and book-to-bill | Ending backlog of $5.3 billion with book-to-bill well above one, and total orders up 41% year over year supported by the WSS Dow order, with growth in three of four segments | Xylem Q2 2026 earnings call | July 28, 2026 |
| Segment performance | Water Infrastructure revenue up 3% with EBITDA margin up 480 bps, Applied Water revenue up 3% with data center orders up over 300%, MCS revenue down 1%, WSS revenue up 1% with a record roughly $850 million 23-year outsourced water project | Xylem Q2 2026 earnings call | July 28, 2026 |
| China exposure | China revenue down about 27% in Q2 2026, about 3% of sales last year and about 2% this year, about a 1% headwind for total Xylem | Xylem Q2 2026 earnings call | July 28, 2026 |
| 2026 guidance | Revenue of roughly $9.2 billion up about 2% reported, organic growth of 2% to 3% versus 2% to 4% prior, EBITDA margin of 23.1% to 23.5%, and adjusted EPS raised to $5.55 to $5.70 from $5.35 to $5.60 | Xylem Q2 2026 earnings call guidance update | July 28, 2026 |
| Q3 2026 guidance | Revenue flat reported and up about 3% organic, EBITDA margin of approximately 23.5% to 24%, and adjusted EPS of $1.42 to $1.47 | Xylem Q2 2026 earnings call | July 28, 2026 |
| Data center exposure | Data center revenue expected up about 200% this year, exiting 2026 at about 2% of total revenue, with WaterFleet acquisition signed for about $200 million including a hyperscaler data center project in Texas | Xylem Q2 2026 earnings call | July 28, 2026 |
| Capital allocation | Net debt to adjusted EBITDA of 0.8x after opportunistic share repurchases in Q2, roughly $1 billion annual M&A deployment target with TriOS closed, WaterFleet signed, and Baycom integrated | Xylem Q2 2026 earnings call | July 28, 2026 |
| FY2025 revenue | $9.035 billion, up 5.52% from $8.562 billion, cross-checked across StockAnalysis.com and SEC EDGAR XBRL with 0.00% deviation | StockAnalysis.com financials and Xylem FY2025 10-K | August 2, 2026 |
| TTM financials | TTM revenue of $9.126 billion, net income of $1.018 billion, EPS of $4.20, gross margin of 39.24%, operating margin of 14.48%, and EBITDA of $1.889 billion | StockAnalysis.com income statement and statistics | August 2, 2026 |
| Cash and cash equivalents | $1.276 billion as of June 30, 2026 | Xylem Q2 2026 Form 10-Q and SEC EDGAR XBRL | August 2, 2026 |
| Total debt | $2.926 billion as of June 30, 2026, with $531 million current and $2.395 billion long-term | Xylem Q2 2026 Form 10-Q and SEC EDGAR XBRL | August 2, 2026 |
| Net debt | $1.650 billion, calculated as total debt of $2.926 billion minus cash of $1.276 billion | Xylem Q2 2026 Form 10-Q cross-check | August 2, 2026 |
| Cash flow | TTM operating cash flow of $1.301 billion, capital expenditures of $341 million, and free cash flow of $960 million at $4.10 per share | StockAnalysis.com cash flow statement | August 2, 2026 |
| Valuation check | 27.83x trailing PE, 20.01x forward PE, 2.99x sales, 2.62x book value, 28.51x free cash flow, 15.42x EV/EBITDA, 1.67 PEG, 1.47% dividend yield | StockAnalysis.com statistics | August 2, 2026 |
| Dividend | Annual dividend of $1.72 per share, 1.47% yield, 40.92% payout ratio, 14 years of dividend growth, and a 9.21% year-over-year dividend increase | StockAnalysis.com dividend and statistics | August 2, 2026 |
| Analyst consensus | Buy with an average target of $153.41 across 23 analysts, low $129 and high $183, median $159 | StockAnalysis.com forecast and analyst ratings | August 2, 2026 |
| Analyst rating mix, July 2026 | 11 Strong Buy, 3 Buy, 9 Hold, 0 Sell out of 23 analysts | StockAnalysis.com forecast recommendation trends | August 2, 2026 |
| Recent analyst target updates | Citi $172 Buy, RBC Capital $164 Outperform, Baird $165 Outperform, Stifel $160 Buy, Goldman Sachs $160 Buy, Barclays $159 Overweight, Oppenheimer $158 Buy, J.P. Morgan $137 Hold, UBS $135 Hold, Mizuho $130 Hold | StockAnalysis.com forecast latest forecasts and TheFly | August 2, 2026 |
| 2026 and 2027 consensus estimates | FY2026 revenue estimate $9.21 billion with adjusted EPS $5.66, FY2027 revenue $9.58 billion with adjusted EPS $6.19 | StockAnalysis.com forecast financial forecast | August 2, 2026 |
| Short interest | 7.68 million shares short, 3.29% of shares outstanding, 3.98 days to cover | StockAnalysis.com statistics short selling | August 2, 2026 |
| Technical snapshot | 20-day SMA near $120.13, 50-day SMA near $114.95, 100-day SMA near $117.18, 200-day SMA near $128.35, 14-day RSI near 47.07, 14-day ADX near 26.87, 14-day historical volatility near 36.2% | Barchart XYL technical analysis | August 2, 2026 |
This XYL AI stock analysis page is an informational research tool only. It is not investment advice, financial advice, or a recommendation to buy or sell Xylem Inc. Forecast ranges are scenarios based on available public data as of the stated cutoff date and may be wrong. Always verify live market data, filings, and your own risk constraints before making decisions.
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