Core Insights - The markets started 2025 strong but have faced increased volatility due to the Trump administration's tariff plans and geopolitical uncertainties, leading to cautious investor behavior [1] Stock Selection Strategy - A conventional method for selecting stocks is focusing on those with steady sales growth, with The Walt Disney Company (DIS), Agnico Eagle Mines Limited (AEM), Adobe Inc. (ADBE), and Xylem Inc. (XYL) highlighted as potential candidates [2][10] - Revenue growth is prioritized over earnings as it indicates an expanding customer base and long-term potential, while stagnant revenue may signal operational challenges [3] - An effective investment strategy should also analyze a company's cash position alongside sales, as strong cash reserves and healthy cash flow provide flexibility for growth and stability [4] Screening Parameters - Stocks are shortlisted based on criteria including 5-Year Historical Sales Growth (%) greater than the industry average and Cash Flow exceeding $500 million [5] - Additional metrics include a Price-to-Sales (P/S) Ratio lower than the industry average, positive % Change in F1 Sales Estimate Revisions, Operating Margin greater than 5%, Return on Equity (ROE) above 5%, and a Zacks Rank of 1 or 2 [6][7][8] Company Highlights - The Walt Disney Company (DIS) has a projected sales growth rate of 4.1% for 2025 and currently holds a Zacks Rank of 2 [11] - Agnico Eagle Mines (AEM) is expected to see a sales growth rate of 24.6% in 2025 and has a Zacks Rank of 1 [12] - Adobe Inc. (ADBE) anticipates a sales increase of 9.5% for fiscal 2025 and holds a Zacks Rank of 2 [12] - Xylem Inc. (XYL) has a projected sales growth of 2.2% for 2025 and also carries a Zacks Rank of 2 [13]

XYLEM INC. Q4 2014 EARNINGS RELEASE FEBRUARY 5, 2015 XYLEM PROPRIETARY / CONFIDENTIAL Q4 2014 EARNINGS RELEASE FORWARD-LOOKING STATEMENTS This presentation contains information that may constitute "forward-looking statements." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Generally, the words "anticipate," "estimate," "expect," "project," "intend," "plan," "forecast," "believe," "target," "will," "could," "would," "should" and similar expressions ident ...

Financial Performance - Q4 2015 organic revenue grew by 2%[9, 18]; adjusted EPS was $0.60, up 3% excluding FX translation[9, 22] - FY 2015 organic revenue grew by 2%[9]; adjusted EPS was $1.85, up 5% excluding FX translation[9] - FY 2015 free cash flow conversion was 105%, driven by working capital improvement[9] - Full year 2015 revenue was $3.653 billion, compared to $3.916 billion in 2014[15] - The company repurchased 1.4 million shares for $50 million during Q4 and 5.1 million shares for $175 million in FY 2015[13] Segment Performance - Water Infrastructure Q4 2015 revenue was $629 million, with organic growth of 1%[27] - Applied Water Q4 2015 revenue was $365 million, with organic growth of 3%[33] - Water Infrastructure full year 2015 revenue was $2.231 billion, with organic growth of 1%[39] - Applied Water full year 2015 revenue was $1.422 billion, with organic growth of 3%[39] Capital Deployment and Outlook - The company announced a dividend increase of 10% on a per share basis[13] - The company acquired Tideland for $69 million, which is expected to generate $43 million in revenue in FY 2016 (11 months)[13] - 2016 revenue is projected to be between $3.675 billion and $3.745 billion[46]

XYLEM INC. Q4 2016 EARNINGS RELEASE FEBRUARY 2, 2017 2 Q4'16 PERFORMANCE SUMMARY XYLEM PROPRIETARY / CONFIDENTIAL Q4 2016 EARNINGS RELEASE FORWARD-LOOKING STATEMENTS This presentation contains information that may constitute "forward-looking statements." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Generally, the words "anticipate," "estimate," "expect," "project," "intend," "plan," "forecast," "believe," "target," "will," "could," "would," "should" a ...

XYLEM INC. Q4 2017 EARNINGS RELEASE FEBRUARY 1, 2018 Q4 2017 EARNINGS RELEASE FORWARD-LOOKING STATEMENTS This presentation contains information that may constitute "forward-looking statements." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Generally, the words "anticipate," "estimate," "expect," "project," "intend," "plan," "forecast," "believe," "target," "will," "could," "would," "should" and similar expressions identify forward- looking statements. ...

Core Insights - Xylem Inc. (XYL) is experiencing strong momentum in its Measurement & Control Solutions segment, driven by high demand for advanced technology solutions such as smart metering [1] - The Water Infrastructure segment is benefiting from increased infrastructure projects in the U.S., particularly in the transport application business [1] - The Applied Water segment is recovering due to higher demand for building solutions applications [1] Financial Performance - As of the end of Q1 2025, Xylem's backlog reached $5.1 billion, supported by strong demand across utilities, industrial, and building solutions markets [2] - For 2025, Xylem anticipates revenues between $8.7 billion and $8.8 billion, reflecting a year-over-year increase of 1-2% [2] - In 2024, acquisitions contributed $786 million to the company's total revenues [4] Strategic Acquisitions - In December 2024, Xylem completed the acquisition of a majority stake in Idrica, enhancing its growth opportunities and market penetration [3] - The acquisition of Evoqua in May 2023 added advanced water and wastewater treatment capabilities to Xylem's portfolio, complementing its solutions across the water cycle [4] Shareholder Returns - In Q1 2025, Xylem paid dividends totaling $98 million and repurchased shares worth $12.9 million [5] - The company increased its dividend rate by 11% in February 2025 [5] Debt and Cost Management - Xylem exited Q1 2025 with long-term debt of $1.97 billion, while cash and cash equivalents stood at $1.06 billion [9] - The company faced rising operating costs, with a 15.1% year-over-year increase in cost of revenues in 2024, and a 1.6% increase in Q1 2025 [9]

Core Viewpoint - Xylem Inc. reported strong financial performance for the fiscal year 2024, with total revenue reaching $8.6 billion, representing a 16% year-over-year growth, driven by robust market demand and operational efficiency [1][2][6]. Financial Performance Summary - In Q4 2024, Xylem achieved total revenue of $2.3 billion, with a net income of $326 million, resulting in an earnings per share (EPS) of $1.34, which is a 22% increase [2][4]. - The adjusted net income for Q4 2024 was $287 million, with an adjusted EPS of $1.18, reflecting a 19% growth [4]. - For the entire year of 2024, the net income was $890 million, with an EPS of $3.65, marking a 31% increase year-over-year [3][6]. Cost and Profitability Insights - The adjusted EBITDA margin for Q4 2024 was 21.0%, an increase of 140 basis points compared to the previous year, attributed to productivity improvements and effective pricing strategies [5]. - The company experienced a net profit margin increase of 190 basis points to 14.5% in Q4 2024, despite facing challenges from restructuring costs and previous year’s tax benefits [4]. Dividend Announcement - The board of directors announced a quarterly dividend of $0.40 per share for Q1 2025, representing an 11% increase from the previous dividend [5]. 2025 Financial Outlook - Xylem projects total revenue for fiscal year 2025 to be between $8.6 billion and $8.7 billion, indicating a growth of 0% to 2% based on reported figures, and 3% to 4% on an organic basis [7]. - The adjusted EBITDA margin for 2025 is expected to improve to between 21.3% and 21.8%, reflecting an increase of 70 to 120 basis points compared to 2024 [7]. - The company anticipates a free cash flow margin of 9% to 10% for the year [7].

Core Insights - Xylem Inc. is experiencing growth in its Measurement & Control Solutions segment due to strong demand for advanced technology solutions like smart metering [1] - The Water Infrastructure segment is benefiting from increased infrastructure projects in the U.S., while the Applied Water segment is recovering due to higher demand for building solutions [1] Financial Performance - As of the end of Q1 2025, Xylem's backlog reached $5.1 billion, supported by strong performance across all regions [2] - The company anticipates revenues between $8.7 billion and $8.8 billion for 2025, reflecting a year-over-year growth of 1-2% [2] Strategic Acquisitions - Xylem is focused on acquisitions to expand its customer base and product offerings, including the acquisition of a majority stake in Idrica in December 2024 [3] - The acquisition of Evoqua in May 2023 enhanced Xylem's capabilities in water treatment, contributing $786 million to total revenues in 2024 [4] Shareholder Returns - In Q1 2025, Xylem paid $98 million in dividends, marking an 11.4% increase year-over-year, and repurchased shares worth $12.9 million [5] - The company raised its dividend rate by 11% in February 2025 [5] Operational Challenges - Xylem is facing rising operating costs, with a 15.1% year-over-year increase in cost of revenues in 2024 and a 1.6% increase in Q1 2025 [8] - Selling, general, and administrative expenses surged 8.8% in 2024 due to operational expenditures from the Evoqua acquisition [8] Debt Levels - The company exited Q1 2025 with long-term debt of $1.97 billion, which may impact profitability [7] - Cash and cash equivalents stood at $1.06 billion, raising concerns given the high debt levels [7]

Financial Data and Key Metrics Changes - Revenue grew 16% on a reported basis and 6% organically in 2024, setting several new records for the company [30] - Net income margins expanded by 210 basis points, and EBITDA margins increased by 170 basis points [31] - Earnings per share increased by 31% [31] Business Line Data and Key Metrics Changes - The company delivered cost synergies from the Evoqua integration faster than expected, contributing to strong financial performance [31] - Focused resources on technologies that deliver the most value to customers and shareholders, including a majority stake in the XilinView platform with Adreco [32] Market Data and Key Metrics Changes - The company is positioned to address growing global water security needs as water scarcity and related natural disasters increase [32][33] Company Strategy and Development Direction - The company is evolving to align its operating model with purpose and profitability, simplifying its structure and transforming its culture [28][29] - A long-range plan was outlined to create a step change in value creation, emphasizing a high-impact culture centered on leadership, accountability, and innovation [29] Management's Comments on Operating Environment and Future Outlook - Management reaffirmed full-year guidance based on the existing tariff scheme and outlined mitigation actions to manage costs [36] - The company is committed to helping customers and communities build a more water-secure world, reflecting a strong focus on sustainability and long-term growth [28][33] Other Important Information - The company ratified the appointment of Deloitte and Touche LLP as its independent registered public accounting firm for 2025 with approximately 96.7% of votes in favor [24] - Shareholder proposal to lower the threshold for calling special meetings was voted against by approximately 54% of shareholders [25] Q&A Session Summary Question: Will tariffs have a big impact on profit margins and what is being done to minimize the impact? - Management stated that they reaffirmed full-year guidance based on the tariff scheme in effect and included a tariff schedule in their earnings deck, with mitigation actions around price and supply chain moves to fully mitigate costs [36]

Financial Data and Key Metrics Changes - The company reported a strong start to the year with revenue growth of 3% in Q1 2025, driven by operational discipline and productivity improvements [11][12] - EBITDA margin expanded by 120 basis points to 20.4%, contributing to a 14% increase in EPS to $1.30, surpassing guidance by $0.08 [11][12] - The ending backlog stood at $5.1 billion, with a book-to-bill ratio above one, indicating strong demand [10][11] Business Line Data and Key Metrics Changes - In Measurement and Control Solutions (MCS), revenue grew by 6% year-over-year, although orders were down 8% due to tough comparisons in smart metering [12][13] - Water Infrastructure saw a 1% increase in orders and a 5% rise in revenue, with significant demand in treatment and transport, despite declines in China [13][14] - Applied Water reported a 3% increase in orders and a 1% rise in revenue, with strong performance in Building Solutions [14] - Water Solutions and Services experienced a 1% revenue growth, with a book-to-bill ratio well over one, although orders decreased by 5% due to a tough comparison from the previous year [15] Market Data and Key Metrics Changes - The company noted a significant decline in imports from China, which are now down considerably compared to previous years, and 75% of goods imported from Mexico are covered under the USMCA exemption [17][18] - The impact of tariffs is being managed through pricing and supply chain actions, with an estimated net increased cost from tariffs on Mexico of $30 million [18] Company Strategy and Development Direction - The company is focused on simplifying its operating model and integrating Evoqua to enhance agility and customer focus, which has already shown productivity improvements [23][24] - There is a strong emphasis on M&A opportunities, particularly in advanced treatment and intelligent solutions, with a robust pipeline identified [25][26] - Sustainability leadership remains a priority, with the company exceeding its 2025 customer sustainability goals ahead of schedule [26][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to manage potential demand softening due to tariffs, with a strong start to the year providing a buffer [36][37] - The full-year guidance for revenue is reaffirmed at $8.7 billion to $8.8 billion, reflecting a 1% to 2% growth, while organic revenue growth remains at 3% to 4% [19][20] - The company anticipates a flat to slightly improved EBITDA margin in Q2, driven by pricing realization and productivity gains [20][21] Other Important Information - The company is actively optimizing its portfolio and has completed a divestiture in Q1, with plans for further strategic divestitures [59] - The organizational restructuring is on track, with a focus on enhancing decision-making speed and accountability across divisions [72][74] Q&A Session Summary Question: Did the company benefit from customers prepositioning inventory ahead of tariffs? - Management indicated that there was no significant increase in orders to get ahead of tariffs, although a small impact was noted in applied water [32][33] Question: What are the assumptions regarding price increases and demand? - Management anticipates some demand decline in the second half of the year but feels confident in managing any impacts due to strong Q1 performance and favorable FX [35][36] Question: How is the company managing pricing in relation to tariffs? - The company is implementing a mix of surcharges and price increases, with actions taken in Q1 and early Q2, and is prepared to adjust based on evolving tariff situations [44][46] Question: What is the outlook for M&A activity in the current market? - Management remains active in pursuing M&A opportunities, with a focus on high-quality targets that align with strategic priorities [57][59] Question: How does the company view the impact of tariffs on its competitive position? - Management believes the company is in a strong competitive position, with a diversified portfolio that helps mitigate tariff impacts [70] Question: Can you provide an update on the organizational realignment? - The restructuring is progressing well, with improvements in decision-making speed and customer focus already being observed [72][74]