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Xylem Inc (XYL) — WACC Analysis

WACC Breakdown

Xylem Inc (XYL) has a weighted average cost of capital (WACC) of 8.5%. The cost of equity is 9.4%, derived from a beta of 0.98 and a risk-free rate of 5.2%. The after-tax cost of debt is 1.6%. The capital structure is 89.1% equity and 10.9% debt.

Interpretation

A WACC of 8.5% is moderate, reflecting the market's balanced risk assessment of Xylem Inc.

Investors can compare XYL's WACC of 8.5% against industry peers to gauge its relative financing costs. A beta of 0.98 reflects the stock's volatility relative to the broader market.

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VALUATION

XYL WACC: 8.54% for Xylem Inc

Current inputs imply a 9.39% cost of equity and a 2.00% pre-tax cost of debt. Use this discount rate as a starting point for DCF validation.

[01]Current Market Data
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WACC Calculation Process
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Market Data Loaded
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Company Data Fetched
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Beta Calculated (5Y)
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Inputs Auto-Populated
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WACC Calculated
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Step 2: Enter Ticker Symbol
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Step 4: Review Auto-Populated WACC Inputs

Values are automatically populated from real data. You can adjust them manually if needed.

4.30%
1.000
4.23%
5.00%
21.00%
70.00%
Debt: 30.00%Equity: 70.00%

Please enter a valid company ticker to calculate WACC

Xylem Inc Common Stock (XYL) WACC Results
Weighted Average Cost of Capital
8.54%
Cost of Equity
9.39%
Risk-Free Rate5.22%
Beta0.98
Market Risk Premium4.23%
Cost of Debt
1.58%
Pre-Tax Cost of Debt2.00%
Tax Rate21.00%
Tax Shield0.42%
Capital Structure
Equity: 89.11%($23.95B)
Debt: 10.89%($2926.00M)
Equity Component
8.37%
89.11% × 9.39%
Debt Component
0.17%
10.89% × 1.58%

Xylem Inc (XYL) WACC in context

Xylem Inc (XYL) currently screens with an estimated WACC of 8.54%. That blends a 9.39% cost of equity, a 2.00% pre-tax cost of debt, and a 89.11% equity weight into the discount rate you would typically use in a DCF model.

falls into a common range for established public companies and is a practical DCF starting point.

What XYL WACC implies

A 8.54% discount rate falls into a common range for established public companies and is a practical DCF starting point.

How this page calculates XYL

This page combines CAPM-based cost of equity with SEC-derived debt and capital structure inputs. The current beta is 0.98 and equity accounts for 89.11% of capital.

What to do next

Validate business quality on the company page, then carry the same discount-rate assumptions into the DCF page to test fair value sensitivity.

Disclaimer: This is not financial advice. Data sourced from SEC EDGAR and Polygon.io. Past performance does not guarantee future results. Always conduct your own research before making investment decisions.