Water technology company Xylem (NYSE: XYL) will be reporting earnings this Tuesday morning. Here’s what investors should know.
Xylem met analysts’ revenue expectations last quarter, reporting revenues of $2.34 billion, up 1.5% year on year. It was a strong quarter for the company, with an impressive beat of analysts’ EBITDA estimates and full-year EPS guidance slightly topping analysts’ expectations.
Is Xylem a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Xylem’s revenue to be flat year on year, slowing from the 7.8% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Xylem has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Xylem’s peers in the industrial machinery segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Gorman-Rupp delivered year-on-year revenue growth of 11.8%, beating analysts’ expectations by 6.4%, and GE Aerospace reported revenues up 17.5%, topping estimates by 3.3%. GE Aerospace traded down 4.9% following the results.
Read our full analysis of Gorman-Rupp’s results here and GE Aerospace’s results here.
In the last twelve months or so, the market has shifted its attention from one area of macro importance to the next (AI disintermediation and AI capex spending to geopolitical conflict, rates, and whether the economy is on solid footing or not). While some of the industrial machinery stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 4.9% on average over the last month. Xylem is up 7.4% during the same time and is heading into earnings with an average analyst price target of $142.63 (compared to the current share price of $108.41).
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