Stock Market Trends on Xylem Shares: Bullish or Bearish?
Xylem Inc. (XYL), a leading company in the design, manufacture, and servicing of engineered products and solutions, has experienced a mixed performance over the past year and in 2025.
In the past year, XYL's growth has been affected by external pressures such as tariffs, inflation, and rising interest rates, which have tightened municipal budgets and delayed water infrastructure projects. Additionally, fluctuations in valuation multiples within the sector, including the slightly elevated P/E ratio of peer Core & Main, may have contributed to XYL's underperformance relative to the broad S&P 500 and specialized clean water ETFs.
However, XYL's fortunes have improved in 2025. Aging water infrastructure, government funding support, and growth in smart water technologies, like smart meters and analytics, boosted by acquisitions such as Evoqua, have provided strong tailwinds for XYL's revenue growth and profitability. Improved execution and integration of acquisitions, disciplined management of supply chain relationships, and a competitive landscape have strengthened XYL’s business fundamentals, supporting better stock performance.
The clean water space has also benefited from growing recognition of its critical role, which may lead to re-rating and outperformance versus more general market or ETF measures in 2025.
As of now, among the 20 analysts covering XYL stock, the consensus is a "Moderate Buy." This consensus has become more bullish in recent months, with 11 analysts suggesting a "Strong Buy." On Jul. 31, XYL shares closed up by 10.7%, and in 2025, XYL stock is up 22.3%. Over the past year, XYL has gained 5.5%.
The mean price target of $160.07 represents a 12.9% premium to XYL's current price levels, with the Street-high price target of $175 suggesting an upside potential of 23.4%. In Q2, XYL reported adjusted EPS of $1.26, exceeding Wall Street expectations of $1.14. The raised price target of $168 implies a potential upside of 18.5% from current levels.
On Aug. 5, UBS kept a "Buy" rating on XYL and raised the price target to $168. It's important to note that, on the date of publication, Neha Panjwani did not have positions in any of the securities mentioned in this article.
In comparison, the Global X Clean Water ETF (AQWA) has gained about 10.6% over the past year, while the S&P 500 Index ($SPX) has rallied nearly 14.3%. Xylem Inc. (XYL) is headquartered in Washington, District of Columbia.
For the current fiscal year, ending in December, analysts expect XYL's EPS to grow 12.7% to $4.81 on a diluted basis.
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