Otter Tail (OTTR) AI Stock Analysis

• Market Cap: $3.44B
• Dividend Yield: 2.38%
• Average Volume (3M): 197.41K
• Price to Earnings (P/E): 12.1
• Beta (1Y): 0.74
• Revenue Growth: -3.69%
• EPS Growth: -8.25%
• Country: US
• Employees: 2,133
• Sector: Industrials
• Sector Strength: 83
• Industry: Diversified Utilities
• EPS (TTM): 1.85
• Shares Outstanding: 41,905,520
• 10 Day Avg. Volume: 246,241
• 30 Day Avg. Volume: 197,407
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.16
• Enterprise Value/Revenue: 3.04
• Enterprise Value/Gross Profit: 7.02
• Enterprise Value/Ebitda: 8.04
• 1Y Price Target: $94.00
• Price Target Upside: 14.49% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 77 Outperform
• Price Target: $94.00 ▲(14.49% Upside)

Otter Tail's overall stock score reflects strong financial performance and positive technical indicators, supported by a reasonable valuation. The increase in earnings guidance and regulatory approvals are significant positives, though challenges such as declining EPS and legislative uncertainties temper the outlook.

Positive Factors

Electric segment performance

OTTR's electric segment revenue exceeded expectations, showing strong performance in this area of the business.

Positive cash flow outlook

Positive free cash flow is forecasted in 2025, with plans for debt issuance in 2026 to support capital expenditures and dividend increases.

PVC pipe margin improvements

Despite reducing revenue forecasts, there is an increase in PVC pipe margin estimates due to higher margins on larger-diameter PVC pipe sales.

Negative Factors

Debt increase concerns

The company's debt increased, reflected in a net debt-to-capital ratio that rose from the previous quarter.

Future EPS decline

The company's EPS guidance for 2025 is significantly lower than previous forecasts.

Manufacturing segment challenges

The manufacturing segment faced a negative impact from tariffs due to an increase in U.S. steel prices.

Otter Tail Business Overview & Revenue Model

Company Description

Otter Tail Corporation, together with its subsidiaries, engages in electric utility, manufacturing, and plastic pipe businesses in the United States. The company's Electric segment produces, transmits, distributes, and sells electric energy in Minnesota, North Dakota, and South Dakota; and operates as a participant in the Midcontinent Independent System Operator, Inc. markets. This segment generates electricity through coal, wind and hydro, and natural gas. It serves approximately 133,000 residential, industrial, and other commercial customers. Its Manufacturing segment engages in the contract machining, metal parts stamping, fabrication and painting, and production of plastic thermoformed horticultural containers, life science and industrial packaging, and material handling components, and extruded raw material stock for recreational vehicle, agricultural, construction, lawn and garden, and industrial and energy equipment industries. It also manufactures clamshell packing, blister packs, returnable pallets, and handling trays for shipping and storing odd-shaped or difficult-to-handle parts for customers in the horticulture, medical and life sciences, industrial, recreation, and electronics industries. The company's Plastics segment manufactures polyvinyl chloride pipes for municipal water, rural water, wastewater, storm drainage and water reclamation system, and other uses. This segment markets its products to wholesalers and distributors through independent sales representatives, company salespersons, and customer service representatives. The company was formerly known as Otter Tail Power Company and changed its name to Otter Tail Corporation in 2001. Otter Tail Corporation was founded in 1907 and is headquartered in Fergus Falls, Minnesota.

How the Company Makes Money

Otter Tail generates revenue primarily through its regulated utility operations, which account for a significant portion of its income. The company earns money by charging customers for electricity and natural gas services, with rates regulated by state utility commissions. Additionally, Otter Tail's manufacturing and construction segments contribute to its revenue by providing specialized products and services to various industries. The company has established significant partnerships with local governments and private sector clients for infrastructure projects, enhancing its earnings potential. Overall, Otter Tail's revenue model is anchored in its ability to provide essential services while capitalizing on its diverse business operations.

Otter Tail Financial Statement Overview

Summary

Otter Tail demonstrates strong profitability with robust EBIT and EBITDA margins, and a balanced capital structure. However, slight revenue and free cash flow growth declines are areas to monitor.

Income Statement

Otter Tail exhibits solid profitability with strong gross and net profit margins. The TTM data shows a gross profit margin of approximately 40.3% and a net profit margin of 22.4%, indicating efficient cost management. However, revenue growth has been slightly negative, reflecting a competitive market. EBIT and EBITDA margins remain robust at 28.0% and 36.6% respectively, showcasing operational efficiency.

Balance Sheet

The company's balance sheet reflects moderate leverage with a debt-to-equity ratio of 0.61, indicating a balanced capital structure. The equity ratio stands at 46.4%, demonstrating a stable financial position. Return on equity is strong at 17.2%, suggesting effective use of shareholder funds, although the substantial debt level is a potential risk.

Cash Flow

Cash flow analysis shows a solid operational cash flow to net income ratio of 1.42, indicating good cash generation relative to profits. Free cash flow growth is negative, showing a decrease, which may signal increased capital expenditures or reduced operational cash inflows. However, the free cash flow to net income ratio is healthy at 0.28, suggesting adequate cash flow management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.31B	1.33B	1.35B	1.46B	1.20B	890.11M
Gross Profit	567.01M	583.10M	565.15M	570.50M	424.07M	302.01M
EBITDA	495.17M	515.83M	499.12M	486.15M	341.95M	232.54M
Net Income	286.16M	301.66M	294.19M	284.18M	176.77M	95.85M
Balance Sheet
Total Assets	3.77B	3.65B	3.24B	2.90B	2.75B	2.58B
Cash, Cash Equivalents and Short-Term Investments	307.24M	294.65M	230.37M	119.00M	1.54M	1.16M
Total Debt	1.04B	1.01B	905.48M	832.02M	855.16M	845.52M
Total Liabilities	1.99B	1.98B	1.80B	1.68B	1.76B	1.71B
Stockholders Equity	1.77B	1.67B	1.44B	1.22B	990.78M	870.97M
Cash Flow
Free Cash Flow	138.95M	94.08M	117.36M	218.18M	59.41M	-159.63M
Operating Cash Flow	388.65M	452.73M	404.50M	389.31M	231.24M	211.92M
Investing Cash Flow	-310.33M	-411.37M	-289.29M	-175.07M	-171.51M	-375.65M
Financing Cash Flow	-1.75M	22.92M	-3.83M	-96.78M	-59.36M	143.69M

Otter Tail Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 82.10
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OTTR, the sentiment is Positive. The current price of 82.1 is above the 20-day moving average (MA) of 78.84, above the 50-day MA of 78.34, and above the 200-day MA of 78.05, indicating a bullish trend. The MACD of 1.01 indicates Negative momentum. The RSI at 60.51 is Neutral, neither overbought nor oversold. The STOCH value of 94.31 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OTTR.

Otter Tail Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OTTR	77 Outperform	$3.44B	12.08	17.13%	2.38%	-3.69%	-8.25%
NWE	74 Outperform	$3.42B	15.15	7.93%	4.68%	3.78%	7.48%
BKH	72 Outperform	$4.44B	15.38	8.13%	4.30%	5.41%	-1.89%
AVA	72 Outperform	$3.04B	16.82	6.91%	5.15%	2.41%	-9.85%
Sector *	71 Outperform	¥268.21B	15.07	8.32%	2.78%	6.19%	11.34%
MGEE	69 Neutral	$3.11B	23.63	10.75%	2.13%	8.47%	12.76%
ALE	62 Neutral	$3.82B	20.77	6.46%	4.40%	-0.44%	-17.46%

Otter Tail Corporate Events

Otter Tail Issues $50 Million in Senior Notes

On March 27, 2025, Otter Tail Power Company entered into a Note Purchase Agreement to issue $100 million in senior unsecured notes, with the Series 2025B Notes being issued on June 5, 2025, for $50 million. The proceeds will be used for capital expenditures, refinancing, and general corporate purposes, while the agreement imposes various financial and operational restrictions on OTP.

The most recent analyst rating on (OTTR) stock is a Hold with a $81.00 price target. To see the full list of analyst forecasts on Otter Tail stock, see the OTTR Stock Forecast page.

Otter Tail Seeks 12.5% Revenue Increase in South Dakota

On June 4, 2025, Otter Tail Power Company, a subsidiary of Otter Tail Corporation, filed a request with the South Dakota Public Utilities Commission for a 12.5% increase in annual revenue, amounting to $5.7 million. This request includes changes in the cost and investment recovery mechanism, shifting from riders to base rates, with the proposed rate change to be effective upon the commission’s final decision or 180 days from the filing date, subject to potential refunds.

The most recent analyst rating on (OTTR) stock is a Buy with a $83.00 price target. To see the full list of analyst forecasts on Otter Tail stock, see the OTTR Stock Forecast page.