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Is this Large Market Cap Stock target price reasonable for Xylem Inc. (NYSE:XYL)?

The company in question is, Xylem Inc. (NYSE:XYL) currently with a stock price of 49.76 (0.20% today). The market cap for Xylem Inc. is 9085.79, and is in the sector Industrial Goods, and Diversified Machinery industry. The target price for Xylem Inc. is 50.42. Currently Xylem Inc. is trading with a P/E of 26.4, and a forward P/E of 22.06. Average volume for Xylem Inc. is 1026.67 and so far today it is 346765.

Performance in the last year for Xylem Inc. has been 48.79%. For EPS growth, Xylem Inc. has seen a growth of 2.30%, and is looking to grow in the next year to 10.24%. More long term stats show that EPS growth has been 1.00% over the last five years and could be 11.33% for the next five years. Xylem Inc. has seen sales growth quarter over quarter at 1.30%, with EPS growth quarter over quarter at -2.80%. The 20-day simple moving average is -1.24%, with the 200-day simple moving average coming to 14.94%.

Since the IPO date for Xylem Inc. on the 10/13/2011, Xylem Inc. has seen performance year to date to be 37.54%. With Xylem Inc. trading at 49.76, the dividend yield is 1.25%, and the EPS is 1.88.

So could Xylem Inc., be undervalued? Well as said before P/E is 26.4. The PEG is 2.33, P/S is 2.47 and the P/B is at 4.09. The P/cash is 15.5, with P/free cash flow at 38.34.

Xylem Inc. ability to deal with debt shows that the current ratio is 2.4, and the quick ratio is 1.9. This is with long term debt/equity at 0.53, and total debt/equity at 0.57.

In terms of margins, Xylem Inc. has a gross margin of 39.20%, an operating margin of 12.20% and a profit margin of 9.20%.Payout ratio for Xylem Inc. is 31.30%. Return on assets come to 7.00% with return on investment coming to 11.80%.

Insider ownership for Xylem Inc., is at 0.20% and institutional ownership comes to 90.10%. Outstanding shares are at 182.96. While shares float is 178.46. The float short is currently 2.43%, and short ratio is 4.23.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Stephen Butters

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