Water Stocks to Buy #1 – Xylem
Spun-off from industrial giant ITT (ITT) a few years ago, Xylem (XYL) could be a great starting point for investors looking at water stocks. Aside from its cool and appropriate name, XYL provides host of equipment — pumps, controllers and filtration devices — for wastewater treatment plants across the globe.
That’s a great business to be in.
As we use more water, we make more “dirty” water. And given our finite supply, cleaning it is a major issue. In fact, analysts peg that 95% of the raw sewage created in the world flows back in our lakes, rivers and aquifers due to the lack of proper cleaning equipment.
As governments around the world realize that they need to keep their water supplies clean, it’s been a boon to XYL’s bottom line. For its recently reported quarter, Xylem reported a 7% boost in revenues as demand for its water infrastructure and applied water products surged. That revenue boost also managed to beat analysts’ prediction by a hefty 5%.
It also helped XYL deliver a nice 10% increase to its dividend.
And with more demand for its products coming, XYL could be one of the best water stocks to buy today.