Core Insights - Xylem reported revenue of $2.26 billion for the quarter ended December 2024, reflecting a 6.5% increase year-over-year and a surprise of +3.37% over the Zacks Consensus Estimate of $2.18 billion [1] - The company's EPS was $1.18, up from $0.99 in the same quarter last year, surpassing the consensus EPS estimate of $1.12 by +5.36% [1] Revenue Performance - Measurement & Control Solutions revenue was $469 million, slightly above the estimated $466.55 million, with a year-over-year change of +0.2% [4] - Applied Water revenue reached $454 million, exceeding the estimate of $451.83 million, but showed a year-over-year decline of -0.7% [4] - Water Infrastructure revenue was $727 million, surpassing the estimated $707.55 million, but down -16.5% compared to the previous year [4] - Water Solutions and Services revenue was $606 million, significantly above the estimated $558.28 million, marking an impressive year-over-year increase of +88.2% [4] Adjusted Operating Income - Adjusted Operating Income for Water Infrastructure was $155 million, exceeding the estimate of $135.54 million [4] - Adjusted Operating Income for Applied Water was $77 million, slightly above the average estimate of $74.90 million [4] - Adjusted Operating Income for Water Solutions and Services was $92 million, surpassing the estimate of $85.56 million [4] - Corporate and other Adjusted Operating Income was -$10 million, better than the estimate of -$16.90 million [4] - Measurement & Control Solutions Adjusted Operating Income was $63 million, below the average estimate of $84.38 million [4] Stock Performance - Xylem's shares have returned +5.1% over the past month, outperforming the Zacks S&P 500 composite's +1% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

2024 Fourth Quarter Results and Earnings Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Generally, the words "anticipate," "estimate," "expect," "project," "intend," "plan," "contemplate," "predict," "forecast," "likely," "believe," "target," "will," "could," "would," "should," "potential," "may" and similar expressions or their ...

Core Insights - Xylem reported quarterly earnings of $1.18 per share, exceeding the Zacks Consensus Estimate of $1.12 per share, and showing an increase from $0.99 per share a year ago, resulting in an earnings surprise of 5.36% [1] - The company generated revenues of $2.26 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.37% and up from $2.12 billion year-over-year [2] - Xylem's stock has increased approximately 5.8% since the beginning of the year, outperforming the S&P 500's gain of 1.9% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1 on revenues of $2.09 billion, and for the current fiscal year, it is $4.66 on revenues of $8.79 billion [7] - The estimate revisions trend for Xylem is currently unfavorable, leading to a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The Waste Removal Services industry, to which Xylem belongs, is currently ranked in the bottom 27% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Another company in the same industry, Waste Connections, is expected to report quarterly earnings of $1.20 per share, reflecting a year-over-year increase of 8.1% [9]

Financial Performance - Total revenue for Q4 2024 was $2.3 billion, exceeding prior guidance, with a year-over-year increase of 7%[1][3] - Net income for Q4 2024 was $326 million, or $1.34 per share, with a net income margin increase of 190 basis points to 14.5%[2][3] - Adjusted EBITDA margin for Q4 2024 was 21.0%, reflecting a year-over-year increase of 140 basis points[3] - Full-year 2024 revenue reached $8.6 billion, up 16% on a reported basis and 6% organically[3] - Adjusted net income for Q4 2024 was $287 million, or $1.18 per share, up 19%[2][3] - Full-year 2024 earnings per share were $3.65, up 31% compared to the previous year[3] - Net income for 2024 increased to $890 million, up 46% from $609 million in 2023[16] - Operating cash flow for 2024 was $1,263 million, a significant increase from $837 million in 2023[16] - Free cash flow for 2024 was calculated as net cash from operating activities minus capital expenditures, resulting in $942 million[24] - Total operating income for the year 2024 was $1,009 million, significantly higher than $652 million in 2023[33] - The adjusted operating margin for Total Xylem for the year 2024 was 16.0%, compared to 14.6% in 2023[36] Revenue Forecast - The company forecasts full-year 2025 revenue of approximately $8.6 to $8.7 billion, representing a growth of 0 to 2% on a reported basis[5] - Full-year 2025 adjusted EBITDA margin is expected to be approximately 21.3 to 21.8%, an increase of 70 to 120 basis points from 2024[5] - The company expects to maintain a positive outlook for 2025, projecting continued revenue growth driven by demand in water infrastructure and solutions[29] Dividends and Shareholder Returns - The Board of Directors declared a first-quarter dividend of $0.40 per share, an increase of 11%[4] - Dividends paid increased to $350 million in 2024, compared to $299 million in 2023, reflecting a commitment to returning value to shareholders[16] Segment Performance - Xylem Inc. reported a revenue of $8,730 million for 2024, representing a 16% increase compared to $7,501 million in 2023[29] - The Water Infrastructure segment achieved $2,727 million in revenue, up 18% from $2,313 million in the previous year[29] - The Water Solutions and Services segment saw a significant revenue increase of 43%, reaching $2,507 million compared to $1,748 million in 2023[29] - The Applied Water segment experienced a slight decline in revenue, down 3% to $1,793 million from $1,853 million[31] - The Measurement and Control Solutions segment reported a revenue increase of 16%, totaling $1,871 million compared to $1,612 million in 2023[31] - Water Infrastructure segment reported Q4 2024 revenue of $727 million, a 7.9% increase from $674 million in Q4 2023[33] Orders and Growth Indicators - The company reported orders of $2.2 billion in Q4 2024, up 7% on both reported and organic bases[3] - The company indicated a strong order growth with a book-to-bill ratio of 1.02 for the year[29] Operational Efficiency - Adjusted EBITDA margin is a key performance indicator, reflecting the company's operational efficiency[22] - Organic revenue growth is a focus, excluding impacts from foreign currency and acquisitions, to better assess underlying performance[19] Cash Flow and Investments - Capital expenditures rose to $321 million in 2024, compared to $271 million in 2023, reflecting ongoing investment in growth[16] - The company reported a net cash decrease in investing activities of $482 million in 2024, down from $628 million in 2023[16] - The effect of exchange rate changes on cash was a negative $53 million in 2024, contrasting with a positive impact of $23 million in 2023[16] Special Charges and Costs - Restructuring & realignment costs for Q1 2024 totaled $36 million, up from $24 million in Q1 2023, while year-to-date costs were $91 million compared to $106 million in 2023[37] - Special charges in Q1 2024 included $15 million for acquisition & integration costs and $6 million for intangible asset impairment, compared to $21 million in 2023[37] - Year-to-date purchase accounting intangible amortization increased to $216 million in 2024 from $176 million in 2023[37] - Special charges for the year-to-date 2024 amounted to $50 million, significantly lower than $134 million in 2023[37] Quarterly Performance - For the quarter ended December 31, 2024, Xylem Inc. achieved a revenue of $2,256 million, a 7% increase from $2,118 million in the same quarter of 2023[31] - Total revenue for Q1 2024 reached $2,033 million, compared to $1,448 million in Q1 2023, reflecting a year-over-year growth of approximately 40.4%[39] - Adjusted operating income for Total Xylem in Q4 2024 was $377 million, compared to $313 million in Q4 2023, reflecting a 20.5% increase[34] - The operating margin for Total Xylem improved to 16.7% in Q4 2024, up from 14.8% in Q4 2023[36] - Adjusted diluted EPS for Q4 2024 was $1.18, an increase from $0.99 in Q4 2023[36] - The company reported a net income of $287 million in Q4 2024, compared to $239 million in Q4 2023[36]

Company Overview - Xylem Inc is a global leader in water technology, spun out from ITT Inc in 2011 [1] - Originally a pure-play water pump manufacturer, the company has expanded its operations both upstream and downstream [1] Analyst Background - The analyst has a background in equity and real estate markets, specializing in identifying long-only opportunities with safe and growing dividends [1] - The analyst has experience managing over $100 million in commercial real estate investments and has a background in economics and applied mathematics [1] Disclosure - The analyst has no stock, option, or derivative positions in any of the mentioned companies and no plans to initiate such positions within the next 72 hours [1] - The article expresses the analyst's own opinions and is not receiving compensation other than from Seeking Alpha [1]

Group 1 - Xylem's shares have experienced a 20% pullback from the 2024 highs, attributed to high valuations and a slight correction in the full-year outlook [1] - The investing group "Value In Corporate Events" focuses on major earnings events, M&A, IPOs, and other significant corporate events, providing actionable ideas for members [1] - The group covers approximately 10 major events each month, aiming to identify the best investment opportunities [1]

US & Canada, Jan. 09, 2025 (GLOBE NEWSWIRE) -- According to a new comprehensive report from The Insight Partners, "the global Water Treatment System Market Size and Forecast (2021 - 2031), Global and Regional Share, Trend, and Growth Opportunity Analysis Report Coverage: By Filtration Process (Distillation, Ultra-violet Sterilization, Reverse Osmosis, Filtration, Ion-Exchange, and Others), Type (Drinking Water Treatment Systems, Industrial Water Treatment Systems, Wastewater Treatment Systems, Portable Wate ...

Xylem Inc. (XYL) recently completed the acquisition of a majority stake in Idrica. The financial terms of the transaction have been kept under wraps.Idrica is a water cycle management company that drives digital transformation in utilities through advanced water technology. It utilizes data management and analytics to streamline water-cycle operations globally.Xylem’s Acquisition RationaleXylem Vue combines Xylem’s digital water solutions and Idrica’s technology platform. It helps customers solve key challe ...

Xylem Inc. (XYL) has failed to impress investors with its recent operational performance due to softness in the Applied Water segment. Also, increasing expenses are likely to impede the company’s earnings in the quarters ahead.Headquartered in Rye Brook, NY, Xylem is one of the leading providers of water solutions worldwide. The company is involved in the full water-process cycle, including the collection, distribution and return of water to the environment. It has a significant presence in the United State ...

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