Forensic Analysis · Machinery & Fabricated Metal Products · as of Nov 9, 2026
Xylem Inc. (XYL)
A forensic read on Xylem Inc. built from its complete SEC filings — financial-health screens, earnings quality, red flags and a price-aware rating. Reproducible math, not opinion.
B · Sound & dependable
Forensic grade
Safe
Financial health
3.9
Distress distance
Clean
Earnings quality
3
Forensic signals
8.7%
ROE
5.5%
Revenue growth
This free snapshot doesn't read filing or proxy text, so the auditor-quality and governance checks that can lower a grade were not evaluated (auditor quality, say on pay, board independence, going concern). Those checks only ever lower a grade, so the full analysis can land below the grade above but never above it — treat it as the most favourable reading, not the settled one.
Xylem Inc. earns a B (Sound & dependable) forensic quality grade, and its balance-sheet distress test reads 3.9, placing it in the Safe zone. 3 forensic signals were flagged in its latest SEC filings, led by share-count dilution.
What the filings flag
+5.8%/yr
FY2023–FY2025
Share-count dilution.Diluted share count changed +12% over the last 2 years to FY2025 (+5.8%/yr). The count is growing — 218.2M shares in FY2023, 244.0M in FY2025: more stock was issued than repurchased over this window, so aggregate results grew faster than their per-share equivalents. That's ~5.8% shaved off per-share growth every year — total profit has to grow that much just to keep earnings-per-share flat, and a stake held since FY2023 has been diluted ~11%.
7.3%
FY2025
Return on invested capital.Return on invested capital is 7.3% in the latest fiscal year and rising across FY2023–FY2025 from 4.5%. After-tax operating profit was $587M in FY2023 and $984M in FY2025, with operating income at 8.9% of revenue in FY2023, 11.8% in FY2024 and 13.5% in FY2025. The capital base behind it went from $12.9B in FY2023 to $13.5B in FY2025 (+4%), while the revenue it carried went from $7.4B to $9.0B.
0.6% of rev
FY2025
Stock-based comp load.Stock-based compensation ran 0.6% of revenue and 6% of free cash flow in FY2025 — about $0.22 per diluted share. No cash left the business to pay it, which is why operating cash flow adds it back. Net of repurchases the diluted count still rose about 5.8% a year across FY2023–FY2025, and the rate is falling. Stock compensation is one source of that issuance; acquisition consideration, equity raises, convertibles and other employee plans also net into the count, and these figures do not separate them.
Key fundamentals
Latest Revenue$9.04B
Revenue Growth YoY+5.5%
Revenue CAGR (2yr)+10.8%
Net Margin10.6%
Free Cash Flow$910.0M
Return on Equity8.7%
Debt / Equity0.17x
The forensic grade and screens above are free — no account needed. Want the AI investment read on top — the 0–100 rating, thesis, bull-vs-bear, red flags and the 12-month scenario, written from Xylem Inc.'s actual 10-K/10-Q/8-K filings?