MeritValue

Xylem Inc.

XYLdata completeness 100%17 fiscal years on file
The thesis, from the filings

Xylem Inc. earns about 8% on invested capital, below its ~9% cost of capital, but has diluted owners by 34% over 5 years — no moat visible in the numbers. The estimate methods put fair value between $25.86 and $212.53 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$5.2B1$5.52B2$7.36B3$8.56B3$9.04B3
Net income$427M4$355M5$609M6$890M6$957M6
Operating cash flow$538M7$596M8$837M9$1.26B9$1.24B9
Capital expenditure$208M10$208M11$271M12$321M12$331M12
Free cash flow (derived)$330M7$388M8$566M9$942M9$910M9
Total debt$2.44B13$1.88B14$2.28B15$4.05B16$3.9B16
Cash & equivalents$1.35B17$944M18$1.02B19$1.12B20$1.48B20
Diluted shares181.5M181.0M218.2M243.5M244.0M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$470.5
your share of equity
Profit it earned you last year
$39.22
Free cash flow it threw off
$37.3
Debt you’d be carrying
$159.68

10 shares is a claim on $470.5 of net worth that earned you $39.22 and generated $37.3 of cash last year, against $159.68 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
8% avg · 5y
FY21 11%FY22 9%FY23 6%FY24 7%FY25 7%

It earned about 8% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
+34% shares · 5y

Share count is up 34% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has risen 60% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $25.86 and $212.53 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$212.53
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$910M
DCF · Growth Exit 5Y
$111.69
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$910M
Earnings Power Value
$25.86
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$609M
  • growthAssumed0.0%
Graham Number
$64.42
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $111.69
The three cases
Bear0.0%$43.38
Base20.0%$111.69
Bull20.0%$111.69

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001524472-24-000006 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001524472-25-000013 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001524472-26-000012 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001524472-24-000006 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001524472-25-000013 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001524472-26-000012 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001524472-24-000006 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001524472-25-000013 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001524472-26-000012 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001524472-24-000006 (PaymentsToAcquireProductiveAssets)
  11. 10-K · period ending 2022-12-31 · accession 0001524472-25-000013 (PaymentsToAcquireProductiveAssets)
  12. 10-K · period ending 2023-12-31 · accession 0001524472-26-000012 (PaymentsToAcquireProductiveAssets)
  13. 10-K · period ending 2021-12-31 · accession 0001524472-23-000009 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001524472-24-000006 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001524472-25-000013 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0001524472-26-000012 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0001524472-23-000009 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0001524472-24-000006 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0001524472-25-000013 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0001524472-26-000012 (CashAndCashEquivalentsAtCarryingValue)