The firm has a $54 price target on shares of the Rye Brook, NY-based water technology provider.
The upgrade is due to a strengthening core public utility market and the pending acquisition of Senus, which boosts its earnings profile comfortably above peers, the Fly noted.
Last week, the company said it would buy Senus for about $1.7 billion in cash. Senus is engaged in smart meters, network technologies and advanced data analytic solutions for the water industry.
Shares of Xylem closed higher on Friday.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of A+ on the stock.
The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins, solid stock price performance and reasonable valuation levels.
The team believes its strengths outweigh the fact that the company has had sub par growth in net income.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: XYL