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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Xylem Inc. (XNYS:XYL) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
XYL
Name:
XYLEM INC. (XNYS:XYL)
Sector:
- 130000.00K
Industry:
Specialty Industrial Machinery
CEO:
Mr. Patrick Decker
Total Employees:
17,300
Our Technological Advancement Rating
Our Rating:
B
Technological advancement compared to industry is -6.37% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF XYLEM INC.(XYL) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SPECIALTY INDUSTRIAL MACHINERY INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
91.21
One Month Price Target:
$91.77
Six Month Price Target :
$94.59
Likely Price in One Year's Time:
Ticker:
$97.98
Likely Trading Range Today Under (Normal Volatility)
$90.91
Price Upper limit ($) :
$91.61
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$87.02
This week:
$81.85
This month :
$72.49
Other Primary facts
Market Cap:
16.67B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
180.18M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
11.26%
-12.03%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$110.63
$101.70
$71.79
$80.72
Medium risk (<10%) entry points
Buy Call
Sell Call
$98.79
Buy Put:
Sell Put:
$96.88
$83.61
$85.54
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
XYL
Sharpe Ratio:
1.84%
Comparison:
XYL, is amongst the top 40% stocks with highest risk-adjusted returns
Sharpe ratio is -2.67% lower than the industry
& is -19.10% lower than the market/S&P 500 average
Average Returns/Yield of
XYL
Daily returns:
0.05%
Weekly returns:
0.25%
Monthly returns:
1.01%
Yearly returns:
16.25%
Comparison of returns:
Average annual returns/yield (last 3 years) is -25.41% below industry average
Classification:
XYL, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.39
Statistical test of Returns:
XYL has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.26%
Weekly Volatility:
5.05%
Monthly Volatility:
10.10%
Yearly Volatility:
34.99%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
0.92%
Volatility in last five trading days has been -59.24% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.59%
Weekly VaR:
-10.26%
Monthly VaR:
-20.52%
How Much Can the price of
XYL
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-18%
Worst case (decline):
-71.09%
This translates to price declining to:
$75.19
This translates to price declining to:
$26.37
Severe Crash Probability
Risk of crash in next 6/12 months: Medium (<50%)
What is Value at Risk (VaR)?
Risk Fundamentals
XYL is a 44.83% riskier investment compared to the market/S&P 500 & is 24.08% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -17.44% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
XYL
Beta in relation to market/S&P 500--1.10
Expected beta in 1 year's time:
0.751
Expected beta in 3 year's time:
1.062
Unlevered (debt free) Beta:
0.736
Beta in relation to Nasdaq (XNAS):
0.815
Beta in relation to all global stocks::
0.778
Beta Comparison & Analysis
Beta of competitors/peers::
1.162
Beta is -4.94% lower than peers
Average Industry Beta:
1.281
Beta is -13.82% below industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
13.89%
Sustainable growth rate is -6.69% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.014
Alpha is -67.47% below industry average alpha yield
Alpha is 89% compared to market & is healthy
Analysis of Cost of Capital of
XYL
Equity cost of capital:
0.107
Equity cost of capital is -10.17% below industry mean WACC
Unlevered (without debt) cost of capital:
7.14%
Before-tax cost of debt:
2.71%
After-tax cost of debt:
2.14%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.14%
WACC is -79.07% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$28.92
Revenue growth rate per share of (3Y):
5.13
Annual revenue growth rate is -101.94% below industry average
EPS:
$2.33
Expected Annual growth rate of EPS (3Y):
1.76%
Expected future EPS growth rate is -42.21% lower than the Specialty Industrial Machinery industry
Free cash flow (FCF) per share:
$1.46
Balance sheet equity growth per share: 33.33%
Equity growth rate per share is 208.78% higher than the industry
Debt per share
$10.42
EBITDA per share
$4.46
Valuation Analysis Today of
XYL
P/E Ratio:
39.25
P/E Ratio of Competitors/Peers:
26.84
P/E ratio is 46.23% higher than main peers & is 42.67% higher than the industry
Stock price/value with industry average P/E ratio: $64.11
XYL is 42.28% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $26.93
Present value of the expected future dividends only: $14.14
P/S (Price to Sales ratio):
3.15
Price to sales ratio is -23.99% below the industry mean
P/B (Price to book value ratio):
5.13
Price to free cash flow: 62.47
Price to free cash flow ratio is 77.72% higher than the industry
Net income growth rate (3Y):
-22.35%
Net income growth rate is -1760.60% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 13.03%
Dividend yeild: 1.27%
Previous Dividend: $0.30
Previous adjusted dividend: $0.30
Previous Dividend: $1.16
Expected next dividend best case: $0.32
Expected next dividend worst case: $0.28
Average dividend payment (long-term): $0.27
Average dividend increase/decrease (growth rate) % per period: 2.32%
Expected next dividend payment date: 21/09/2022
Expected next dividend record date: 24/08/2022
Expected next dividend declaration date: 08/10/2022
Previous dividend payment date: 23/06/2022
Previous dividend record date: 26/05/2022
Previous dividend declaration date: 05/12/2022
Dividend History:
2022-05-25--$0.30
2021-11-22--$0.28
2021-05-26--$0.28
2022-02-16--$0.30
2021-08-25--$0.28
2021-02-17--$0.28
Dividend growth rate is -33.47% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
58.72%
Net debt to equity ratio:
43.43%
Debt to assets ratio:
22.85%
Net debt to assets ratio:
16.90%
Debt-to-asset ratio is -57.65% below industry average
Ability to repay debt:
Interest coverage ratio:
11.82
Interest coverage ratio is -39.42% less than industry average
Looking forward:
Debt growth rate:
93.19%
Annual debt growth is 25% higher than industry average debt growth rate
Debt repayment rate in last quarter: 0.00%
Analysis of Key Statistics
Correlation of price movement with the market:
0.768
Statistical significance of correlation:
XYL has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.635
Stock price is 20.87% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.635
Correlation of price movement with Nasdaq (^IXIC):
0.007
Covariance of price movement with the market:
0.01
Kurtosis
5.513
Returns have moderate fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.032
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
XYL
Gross Profit Margin Ratio:
150%
Operating Profit Margin Ratio:
10.80%
Operating profit margin is -144.62% lower than the industry
Net Profit Margin Ratio:
150%
Effective Tax Rate:
14.75%
Effective tax rate is -21.08% lower than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
13.20%
Return on equity (ROE) is 292.72% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.13%
Return on assets (ROA) is 9.40% higher than the industry
Financial Leverage:
1.3x
Current Ratio:
1.62
Current ratio is -46.24% below industry average
Cash Conversion Cycle (days):
-52.9
Cash conversion cycle is -185.89% below industry average
The remaining useful life of property plant & equipment is: 6.3 years
Stock based compensation to net income ratio:
2.13%
In-depth Efficiency Analysis
Revenue generated per employee:
301.2K
Each employee generates -92% less revenue than industry average revenue per employee
EBITDA generated per employee:
46.5K
Each employee generates -94% less EBITDA than industry average revenue per employee
Profit generated per employee:
24.4K
Each employee generates -94% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 7.5K
Each employee generates -115% less free cash flow than industry average revenue per employee
Assets/Capital per employee
294.9K
Each employee generates -115% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
Research & development (R&D) investment growth rate-- 9.09%
Growth rate in R&D investment/expenditure is -15.78% lower than the industry
Competitors/Peer firms of
XYL
TRANSUNION (XNYS:TRU)
GENERAC HOLDINGS INC. (XNYS:GNRC)
CNH Industrial NV (XNYS:CNHI)
HEI-A
ZTO EXPRESS (CAYMAN) INC. (XNYS:ZTO)
UNITED RENTALS, INC. (XNYS:URI)
WESTINGHOUSE AIR BRAKE TECHNOLOGIES CORPORATION (XNYS:WAB)
JACOBS SOLUTIONS INC. (XNYS:J)
AVERY DENNISON CORPORATION (XNYS:AVY)
Current Analyst Ratings
Strong buy�13%
Buy�29%
Hold�25%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Buy
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
5.21B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
3.26B
1.95B
206.00M
-
1.18B
-
-
1.39B
-
68.00M
241.00M
804.00M
563.00M
422.00M
495.00M
73.00M
422.00M
Statement of Cash Flow
Date:
Period:
58.00M
Differed Income Tax :
-
Stock Based Compensation :
9.00M
Change in Working Capital :
- 229000.00K
Accounts Receivables:
-
Other Working Capital:
- 79000.00K
Other Non-Cash Items:
- 1000.00K
Net Cash Provided by Operating Activities:
- 81000.00K
Investments in PP&E:
-
Net Acquisitions:
1.00M
Purchases of Investments:
- 6000.00K
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
1.12B
-
1.12B
1.01B
804.00M
186.00M
3.12B
636.00M
2.78B
1.00B
-
-
681.00M
5.10B
-
8.22B
652.00M
628.00M
89.00M
-
640.00M
1.92B
1.88B
932.00M
3.09B
-
5.01B
2.00M
2.18B
- 377000.0K
-
March 31, 2022 at 6:00:00 AM
4.65B
3.20B
8.21B
-
2.51B
1.4B
4.00M
- 42000.00K
- 43000.00K
-
-
- 51000.00K
- 55000.00K
-
- 106000.00K
- 2000.00K
- 232000.00K
1.12B
1.35B
- 81000.00K
- 49000.00K
- 130000.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
XYL
2023
2024
2025
2026
2027
$100.42
$107.87
$115.88
$124.48
$133.72