Stifel cuts Xylem stock price target on growth concerns to $141

Stifel lowered its price target on Xylem Inc. from $160 to $141 while keeping a Buy rating. The water technology company has fallen about 14% in the latest quarter and about 25% year-to-date, trading at $104.05, just above its 52-week low of $98.58. Analyst Nathan Jones stated that Xylem appears undervalued, placing it among the most undervalued stocks.

However, the stock faces low organic growth, questions on utility capital expenditures, and headwinds on electric meters, with investor preference for cyclical stocks contributing to multiple compression. Xylem delivered against its 2026 commitments but faces significant challenges. Stifel expects accelerating revenue growth in 2027, continued margin expansion, and improved cash flow as restructuring expenses decrease.

Xylem reported adjusted earnings of $1.46 per share on $2.3 billion in revenue, beating estimates, and raised its full-year profit outlook. The company also completed a $1.5 billion public offering of senior unsecured notes for acquisitions in its pump business. Analyst Stifel reaffirmed its Buy rating with a price target of $141, noting Xylem's data center business expansion and a leadership team transition.