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Otis Worldwide
(NYSE:OTIS)
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Rating:67Neutral
Price Target:
$77.00
â–¼(-5.44% Downside)
Action:Reiterated
Date:05/30/26
OTIS scores well on underlying business quality and cash generation, but the overall rating is capped by balance-sheet risk (negative equity and sizable debt). Near-term technical weakness also weighs on the score, while moderate valuation and a constructive (though margin-pressured) outlook from the latest earnings call provide support.
Positive Factors
Cash generation
Otis's TTM free cash flow (~$1.67B) and ~90% FCF-to-net-income conversion give durable internal funding for share repurchases, dividend increases and incremental investments. Strong cash conversion helps fund strategy execution and de‑risk operations over the next several quarters.
Negative Factors
Aggressive capital structure
Negative shareholders’ equity and elevated total debt materially constrain financial flexibility, increase refinancing and rating risk, and limit discretionary uses of cash. This aggressive structure can hamper M&A optionality and raises vulnerability to interest‑rate or cyclical stress.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash generation
Otis's TTM free cash flow (~$1.67B) and ~90% FCF-to-net-income conversion give durable internal funding for share repurchases, dividend increases and incremental investments. Strong cash conversion helps fund strategy execution and de‑risk operations over the next several quarters.
Read all positive factors
Otis Worldwide Key Performance Indicators (KPIs)
Any
Remaining Performance Obligations
Indicates the total value of contracted work that has yet to be completed, providing a glimpse into future revenue streams and business stability.
Indicates the total value of contracted work that has yet to be completed, providing a glimpse into future revenue streams and business stability.
Data provided by:
The Fly
The FlyOtis Worldwide (OTIS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$28.20B
Dividend Yield1.88%
Average Volume (3M)3.52M
Price to Earnings (P/E)19.3
Beta (1Y)0.56
Revenue Growth3.34%
EPS Growth-1.24%
CountryUS
Employees72,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)3.80
Shares Outstanding383,716,060
10 Day Avg. Volume3,003,000
30 Day Avg. Volume3,523,356
Financial Highlights & Ratios
PEG Ratio-1.78
Price to Book (P/B)-6.38
Price to Sales (P/S)2.38
P/FCF Ratio23.81
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue2.41
Enterprise Value/Gross Profit7.93
Enterprise Value/Ebitda14.51
Forecast
1Y Price Target
$91.50Price Target Upside12.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering9
EPS Forecast (FY)4.18
Revenue Forecast (FY)$15.15B
Otis Worldwide Business Overview & Revenue Model
Company Description
Otis Worldwide Corporation is a global leader specializing in the manufacturing, installation, and servicing of elevators and escalators, with significant operations in the United States, China, and numerous other international markets. The compan...
How the Company Makes Money
Otis primarily makes money through two main revenue streams: (1) Service (maintenance, repair, and modernization) and (2) New Equipment (sale and installation of new elevators and escalators). Service revenue is typically generated via ongoing mai...
Otis Worldwide Earnings Call Summary
Earnings Call Date:Apr 22, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Jul 22, 2026
Earnings Call Sentiment Positive
The call presented a generally constructive outlook anchored by solid service growth (service organic +5%, repair +10%), a sizable modernization backlog (up ~30% CC) and strong cash generation (Q1 adjusted free cash flow ~$272M, +46% YoY), alongside product launches and strategic investments that should support long-term growth. However, near-term profitability was pressured by a 160-bp contraction in service margins, new equipment softness (new equipment organic -5% and margin down to 3.3%), China market weakness, portfolio mix headwinds, and incremental investments (~$50M) that will weigh on the first half of the year. Management maintained full-year guidance with expectations for sequential margin recovery and second-half acceleration, leading to confidence in returning to margin expansion later in 2026.Positive Updates
Service Revenue Growth
Service organic sales grew 5% in Q1 2026 with broad-based strength across all service lines; maintenance and repair organic sales increased 4%, and repair organic sales rose ~10% reflecting solid orders momentum.
Negative Updates
Service Margin Contraction
Service operating margin contracted 160 basis points to 23% in Q1 2026, driven by higher investments to support growth, labor and material cost inflation, and unfavorable mix toward lower-value markets.
Read all updates
Q1-2026 Updates
Positive
Negative
Service Revenue Growth
Service organic sales grew 5% in Q1 2026 with broad-based strength across all service lines; maintenance and repair organic sales increased 4%, and repair organic sales rose ~10% reflecting solid orders momentum.
Read all positive updates
Company Guidance
Otis guided 2026 net sales of $15.1–$15.3 billion with organic sales up low- to mid-single digits, adjusted operating profit of approximately $2.5 billion (up $20–$60 million at constant currency; $60–$100 million on an actual-currency basis), adjusted EPS of $4.20–$4.24 (mid-single-digit increase vs. 2025), and adjusted free cash flow of $1.6–$1.65 billion; they reiterated a full‑year target of $800 million share repurchases (about $400 million completed in Q1) and a recently announced 5% quarterly dividend increase. For businesses, Otis expects service organic growth to accelerate to mid‑ to high‑single digits (repair ~10% growth; modernization backlog up ~30% CC and modernization orders expected to grow in the low‑teens or above), new‑equipment organic sales to be down low single digits to flat (industry units ~‑2% for 2026, with Asia/China weaker and Americas improving), total backlog near $20 billion, Q2 EPS to be down ~3–5% year‑over‑year with service margins (23% in Q1, ‑160 bps) to sequentially improve and return to year‑over‑year expansion by Q4.Otis Worldwide Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
28
Negative
Cash Flow
81
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 14.65B | 14.43B | 14.26B | 14.21B | 13.69B | 14.30B |
| Gross Profit | 4.45B | 4.37B | 4.26B | 4.19B | 3.92B | 4.19B |
| EBITDA | 2.43B | 2.31B | 2.23B | 2.44B | 2.26B | 2.30B |
| Net Income | 1.48B | 1.38B | 1.65B | 1.41B | 1.25B | 1.25B |
Balance Sheet | ||||||
| Total Assets | 10.54B | 10.65B | 11.32B | 10.12B | 9.82B | 12.28B |
| Cash, Cash Equivalents and Short-Term Investments | 834.00M | 1.10B | 2.30B | 1.27B | 1.19B | 1.56B |
| Total Debt | 8.22B | 8.75B | 8.74B | 7.31B | 7.21B | 7.79B |
| Total Liabilities | 15.98B | 15.92B | 16.04B | 14.84B | 14.48B | 15.26B |
| Stockholders Equity | -5.68B | -5.39B | -4.85B | -4.92B | -4.87B | -3.63B |
Cash Flow | ||||||
| Free Cash Flow | 1.67B | 1.44B | 1.44B | 1.49B | 1.45B | 1.59B |
| Operating Cash Flow | 1.82B | 1.60B | 1.56B | 1.63B | 1.56B | 1.75B |
| Investing Cash Flow | -230.00M | -406.00M | -239.00M | -183.00M | -33.00M | -89.00M |
| Financing Cash Flow | -2.69B | -2.42B | -234.00M | -1.35B | -3.65B | 58.00M |
Otis Worldwide Technical Analysis
Positive
81.43
Price Trends
72.78
Positive
78.14
Negative
83.24
Negative
Market Momentum
0.12
Negative
54.36
Neutral
58.62
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OTIS, the sentiment is Positive. The current price of 81.43 is above the 20-day moving average (MA) of 72.08, above the 50-day MA of 72.78, and below the 200-day MA of 83.24, indicating a neutral trend. The MACD of 0.12 indicates Negative momentum. The RSI at 54.36 is Neutral, neither overbought nor oversold. The STOCH value of 58.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OTIS.
Otis Worldwide Risk Analysis
Otis Worldwide disclosed 27 risk factors in its most recent earnings report. Otis Worldwide reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Otis Worldwide Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | $122.48B | 34.83 | 24.69% | 0.79% | 6.03% | 4.26% | |
77 Outperform | $53.73B | 48.54 | 30.25% | 1.33% | 10.45% | 21.30% | |
71 Outperform | $79.29B | 31.70 | 12.11% | 1.58% | 4.03% | 3.51% | |
70 Outperform | $78.91B | 25.12 | 97.38% | 2.43% | 2.90% | -5.25% | |
67 Neutral | $28.20B | 19.32 | -27.10% | 1.88% | 3.34% | -1.24% | |
65 Neutral | $31.55B | 52.47 | 5.80% | 0.10% | 6.86% | -26.67% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% |
* Industrials Sector Average
OTIS
Otis Worldwide
73.43
-24.27
-24.84%
EMR
Emerson Electric Company
137.91
1.40
1.03%
ITW
Illinois Tool Works
271.09
19.55
7.77%
PH
Parker Hannifin
957.51
256.68
36.63%
ROK
Rockwell Automation
468.90
135.47
40.63%
IR
Ingersoll Rand
78.71
-8.21
-9.45%
Otis Worldwide Corporate Events
Executive/Board ChangesShareholder Meetings
Otis Worldwide Shareholders Back Board, Pay at Annual Meeting
Positive
May 29, 2026
Otis Worldwide held its 2026 Annual Meeting of Shareholders on May 27, 2026, with a quorum of over 345 million shares represented, and shareholders elected all ten director nominees to serve until the 2027 meeting. Investors also approved on an ad...
Business Operations and StrategyPrivate Placements and Financing
Otis Worldwide Issues $700 Million Notes to Refinance Debt
Positive
May 7, 2026
On May 7, 2026, Otis Worldwide Corporation issued $700 million of 4.488% unsecured, unsubordinated notes due May 7, 2029, under its existing indenture framework, with interest payable semiannually and customary redemption, change-of-control and co...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.