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Otis Worldwide
(NYSE:OTIS)
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Rating:62Neutral
Price Target:
$76.00
â–²(5.66% Upside)
Action:Reiterated
Date:07/22/26
OTIS scores as a moderately attractive, cash-generative business with steady profitability and strong free cash flow, but the overall rating is held back by balance-sheet risk (negative equity and sizable debt) and near-term margin/EPS pressure highlighted in the latest guidance update. Technicals are neutral-to-soft and valuation looks reasonable rather than compelling, keeping the score in the low 60s.
Positive Factors
Service-led recurring revenue
Otis’s service business is the durable core: recurring maintenance, repair and modernization sales grew strongly, providing predictable revenue and higher-margin cash flow. The large installed base and diversified service lines reduce cyclicality versus new equipment and support multi-quarter revenue stability and organic growth.
Negative Factors
Weak balance sheet optics
Persistently negative equity and rising debt elevate financial risk and limit flexibility. Negative equity skews leverage metrics, can constrain rating/borrowing costs, and reduces cushion in downturns; with debt meaningful relative to annual cash flow, the company has less room for opportunistic spending or prolonged weakness.
Read all positive and negative factors
Positive Factors
Negative Factors
Service-led recurring revenue
Otis’s service business is the durable core: recurring maintenance, repair and modernization sales grew strongly, providing predictable revenue and higher-margin cash flow. The large installed base and diversified service lines reduce cyclicality versus new equipment and support multi-quarter revenue stability and organic growth.
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
$27.39B
Dividend Yield2.36%
Average Volume (3M)3.93M
Price to Earnings (P/E)18.4
Beta (1Y)0.54
Revenue Growth5.24%
EPS Growth2.75%
CountryUS
Employees72,000
SectorIndustrials
Sector Strength72
IndustryIndustrial - Machinery
Share Statistics
EPS (TTM)3.91
Shares Outstanding380,669,340
10 Day Avg. Volume4,560,108
30 Day Avg. Volume3,932,366
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$88.00Price Target Upside22.34% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)4.1
Revenue Forecast (FY)$15.21B
Otis Worldwide Business Overview & Revenue Model
Company Description
Otis Worldwide Corporation (OTIS) is a global elevator and escalator company that designs, manufactures, installs, modernizes, and services vertical transportation systems. The company provides elevators, escalators, and moving walkways for reside...
How the Company Makes Money
Otis primarily makes money through two major revenue streams: (1) New Equipment and (2) Service. New Equipment revenue comes from selling and installing new elevators, escalators, and moving walkways, typically tied to new construction or major bu...
Otis Worldwide Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 28, 2026
Earnings Call Sentiment Neutral
The call highlighted strong top-line momentum, especially in service (repair and modernization), robust cash generation, and early signs that targeted service-quality investments are improving customer metrics. However, these positives are balanced by near-term margin pressure from higher labor and material costs, onboarding/productivity headwinds, tempered micro-pricing to protect retention, and a modest revision to profit and EPS guidance. Management emphasized that many of the cost pressures are temporary and framed current reinvestments as positioning the company for multi-year growth.Positive Updates
Top-line growth and sales
Net sales of $3.9 billion in Q2 with organic sales up 6% year-over-year; company reiterates full-year net sales outlook of $15.1–$15.3 billion and organic growth of low- to mid-single digits.
Negative Updates
Margin compression and operating profit decline
Adjusted operating profit decreased by $32 million in the quarter (excluding a $7 million FX tailwind); adjusted operating profit margin declined 180 basis points to 15.2%; adjusted EPS declined 4% (down $0.04) in Q2.
Read all updates
Q2-2026 Updates
Positive
Negative
Top-line growth and sales
Net sales of $3.9 billion in Q2 with organic sales up 6% year-over-year; company reiterates full-year net sales outlook of $15.1–$15.3 billion and organic growth of low- to mid-single digits.
Read all positive updates
Company Guidance
Otis reiterated 2026 revenue guidance of $15.1–$15.3 billion with organic sales growth of low- to mid-single digits and unchanged market expectations, and updated earnings and cash guidance: adjusted operating profit now expected to be down $30 million to flat on an actual‑currency basis (down $45 million to down $15 million at constant currency), adjusted free cash flow of $1.5–$1.55 billion, and adjusted EPS of $4.01–$4.05 (including a ~$0.04 FX headwind versus prior). Management expects service to remain the growth engine (Q2 service organic +9%, service expected ≈6% in H2 and mid-single-digit in Q3), service margins to improve from Q2’s 23.2% toward mid‑24% in Q3 and roughly ~25% exit in Q4 (full‑year service margin slightly below 24%), and new equipment to stabilize and return to sequential growth in H2 (Q2 new equipment backlog +4% y/y, +9% ex‑China; modernization backlog +26% y/y; modernization orders +9%). The revision factors include a ~$20 million hit versus prior outlook from tempered maintenance micro‑pricing, roughly $50 million incremental productivity/material headwind (≈$30M temporary ramp costs and $20M related to material/quality investments), and the planned $50 million service‑excellence program (≈$30M invested in H1, $20M to go).Otis Worldwide Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
28
Negative
Cash Flow
80
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 14.91B | 14.43B | 14.26B | 14.21B | 13.69B | 14.30B |
| Gross Profit | 4.50B | 4.37B | 4.26B | 4.19B | 3.92B | 4.19B |
| EBITDA | 2.41B | 2.31B | 2.23B | 2.44B | 2.26B | 2.30B |
| Net Income | 1.52B | 1.38B | 1.65B | 1.41B | 1.25B | 1.25B |
Balance Sheet | ||||||
| Total Assets | 11.16B | 10.65B | 11.32B | 10.12B | 9.82B | 12.28B |
| Cash, Cash Equivalents and Short-Term Investments | 813.00M | 1.10B | 2.30B | 1.27B | 1.19B | 1.56B |
| Total Debt | 8.85B | 8.75B | 8.74B | 7.31B | 7.21B | 7.79B |
| Total Liabilities | 16.72B | 15.92B | 16.04B | 14.84B | 14.48B | 15.26B |
| Stockholders Equity | -5.75B | -5.39B | -4.85B | -4.92B | -4.87B | -3.63B |
Cash Flow | ||||||
| Free Cash Flow | 1.71B | 1.44B | 1.44B | 1.49B | 1.45B | 1.59B |
| Operating Cash Flow | 1.87B | 1.60B | 1.56B | 1.63B | 1.56B | 1.75B |
| Investing Cash Flow | -402.00M | -406.00M | -239.00M | -183.00M | -33.00M | -89.00M |
| Financing Cash Flow | -1.32B | -2.42B | -234.00M | -1.35B | -3.65B | 58.00M |
Otis Worldwide Technical Analysis
Positive
71.93
Price Trends
72.05
Positive
74.67
Negative
81.60
Negative
Market Momentum
0.04
Negative
54.67
Neutral
55.01
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 71.93 is below the 20-day moving average (MA) of 72.60, below the 50-day MA of 72.05, and below the 200-day MA of 81.60, indicating a neutral trend. The MACD of 0.04 indicates Negative momentum. The RSI at 54.67 is Neutral, neither overbought nor oversold. The STOCH value of 55.01 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 |
|---|---|---|---|---|---|---|---|
76 Outperform | $83.91B | 34.44 | 12.68% | 1.48% | 4.03% | 3.51% | |
76 Outperform | $32.63B | 34.03 | 9.46% | 0.09% | 7.85% | 88.74% | |
69 Neutral | $100.10B | 34.31 | 34.49% | 0.83% | 7.04% | 4.58% | |
65 Neutral | $14.37B | 18.75 | 65.30% | 0.97% | -2.11% | -5.59% | |
65 Neutral | $50.95B | 42.53 | 8.89% | 1.37% | -1.58% | -43.59% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
62 Neutral | $27.39B | 18.40 | -27.26% | 2.36% | 5.24% | 2.75% |
* Industrials Sector Average
OTIS
Otis Worldwide
73.10
-12.14
-14.24%
EMR
Emerson Electric Company
162.47
30.68
23.28%
TT
Trane Technologies
483.58
60.49
14.30%
LII
Lennox International
446.87
-141.87
-24.10%
IR
Ingersoll Rand
90.00
13.60
17.80%
CARR
Carrier Global
65.43
0.32
0.49%
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.