OTIS WORLDWIDE CORP (OTIS) Stock Fundamental Analysis
NYSE:OTIS - New York Stock Exchange, Inc. - US68902V1070 - Common Stock - Currency: USD
Taking everything into account, OTIS scores 5 out of 10 in our fundamental rating. OTIS was compared to 128 industry peers in the Machinery industry. While OTIS has a great profitability rating, there are quite some concerns on its financial health. OTIS is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
OTIS had positive earnings in the past year.
In the past year OTIS had a positive cash flow from operations.
OTIS had positive earnings in each of the past 5 years.
OTIS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 13.73%, OTIS belongs to the top of the industry, outperforming 92.19% of the companies in the same industry.
OTIS has a better Return On Invested Capital (40.85%) than 99.22% of its industry peers.
OTIS had an Average Return On Invested Capital over the past 3 years of 50.77%. This is significantly above the industry average of 10.71%.
The last Return On Invested Capital (40.85%) for OTIS is well below the 3 year average (50.77%), which needs to be investigated, but indicates that OTIS had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.73% | ||
| ROE | N/A | ||
| ROIC | 40.85% |
ROA(3y)13.73%
ROA(5y)11.96%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)50.77%
ROIC(5y)42.31%
1.3 Margins
With a decent Profit Margin value of 10.83%, OTIS is doing good in the industry, outperforming 74.22% of the companies in the same industry.
In the last couple of years the Profit Margin of OTIS has grown nicely.
OTIS's Operating Margin of 12.07% is fine compared to the rest of the industry. OTIS outperforms 61.72% of its industry peers.
OTIS's Operating Margin has improved in the last couple of years.
With a Gross Margin value of 29.84%, OTIS perfoms like the industry average, outperforming 46.88% of the companies in the same industry.
In the last couple of years the Gross Margin of OTIS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.07% | ||
| PM (TTM) | 10.83% | ||
| GM | 29.84% |
OM growth 3Y1.53%
OM growth 5Y1.94%
PM growth 3Y9.8%
PM growth 5Y6.28%
GM growth 3Y0.59%
GM growth 5Y0.47%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), OTIS is creating value.
The number of shares outstanding for OTIS has been reduced compared to 1 year ago.
OTIS has less shares outstanding than it did 5 years ago.
The debt/assets ratio for OTIS is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 3.05 indicates that OTIS is not in any danger for bankruptcy at the moment.
The Altman-Z score of OTIS (3.05) is comparable to the rest of the industry.
OTIS has a debt to FCF ratio of 5.79. This is a neutral value as OTIS would need 5.79 years to pay back of all of its debts.
OTIS has a Debt to FCF ratio (5.79) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.79 | ||
| Altman-Z | 3.05 |
ROIC/WACC4.3
WACC9.5%
2.3 Liquidity
OTIS has a Current Ratio of 0.94. This is a bad value and indicates that OTIS is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.94, OTIS is not doing good in the industry: 92.19% of the companies in the same industry are doing better.
A Quick Ratio of 0.87 indicates that OTIS may have some problems paying its short term obligations.
OTIS has a Quick ratio of 0.87. This is in the lower half of the industry: OTIS underperforms 71.09% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.87 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.91% over the past year.
Measured over the past years, OTIS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.53% on average per year.
Looking at the last year, OTIS shows a decrease in Revenue. The Revenue has decreased by -0.88% in the last year.
The Revenue has been growing slightly by 1.68% on average over the past years.
EPS 1Y (TTM)6.91%
EPS 3Y8.48%
EPS 5Y9.53%
EPS Q2Q%4.55%
Revenue 1Y (TTM)-0.88%
Revenue growth 3Y-0.09%
Revenue growth 5Y1.68%
Sales Q2Q%-2.53%
3.2 Future
The Earnings Per Share is expected to grow by 10.10% on average over the next years. This is quite good.
OTIS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.18% yearly.
EPS Next Y6.78%
EPS Next 2Y9.01%
EPS Next 3Y9.14%
EPS Next 5Y10.1%
Revenue Next Year2.85%
Revenue Next 2Y3.58%
Revenue Next 3Y3.87%
Revenue Next 5Y4.18%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 25.59, the valuation of OTIS can be described as expensive.
Compared to the rest of the industry, the Price/Earnings ratio of OTIS is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 27.15. OTIS is around the same levels.
The Price/Forward Earnings ratio is 21.75, which indicates a rather expensive current valuation of OTIS.
The rest of the industry has a similar Price/Forward Earnings ratio as OTIS.
OTIS's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.60.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.59 | ||
| Fwd PE | 21.75 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, OTIS is valued a bit more expensive than the industry average as 67.97% of the companies are valued more cheaply.
OTIS's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.9 | ||
| EV/EBITDA | 24.09 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of OTIS may justify a higher PE ratio.
PEG (NY)3.77
PEG (5Y)2.68
EPS Next 2Y9.01%
EPS Next 3Y9.14%
5. Dividend
5.1 Amount
OTIS has a Yearly Dividend Yield of 1.72%.
OTIS's Dividend Yield is a higher than the industry average which is at 1.88.
Compared to the average S&P500 Dividend Yield of 2.42, OTIS is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.72% |
5.2 History
OTIS has been paying a dividend for over 5 years, so it has already some track record.
OTIS has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
OTIS pays out 40.59% of its income as dividend. This is a bit on the high side, but may be sustainable.
DP40.59%
EPS Next 2Y9.01%
EPS Next 3Y9.14%
99.02
+1.42 (+1.45%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners92.99%
Inst Owner Change-1.76%
Ins Owners0.09%
Ins Owner Change5.65%
Market Cap39.08B
Analysts67.62
Price Target100.42 (1.41%)
Short Float %1.71%
Short Ratio2.36
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.72% |
Yearly Dividend1.51
Dividend Growth(5Y)N/A
DP40.59%
Div Incr Years4
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.58%
Min EPS beat(2)-4.23%
Max EPS beat(2)-0.93%
EPS beat(4)1
Avg EPS beat(4)-1.64%
Min EPS beat(4)-4.23%
Max EPS beat(4)1.27%
EPS beat(8)3
Avg EPS beat(8)0.44%
EPS beat(12)6
Avg EPS beat(12)1.21%
EPS beat(16)10
Avg EPS beat(16)2.02%
Revenue beat(2)0
Avg Revenue beat(2)-1.62%
Min Revenue beat(2)-2.5%
Max Revenue beat(2)-0.73%
Revenue beat(4)0
Avg Revenue beat(4)-2.89%
Min Revenue beat(4)-5.29%
Max Revenue beat(4)-0.73%
Revenue beat(8)1
Avg Revenue beat(8)-1.85%
Revenue beat(12)2
Avg Revenue beat(12)-1.89%
Revenue beat(16)4
Avg Revenue beat(16)-1.38%
PT rev (1m)0%
PT rev (3m)-1.33%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-2.16%
EPS NY rev (1m)0.18%
EPS NY rev (3m)-1.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.58%
Revenue NY rev (1m)0.02%
Revenue NY rev (3m)1.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.59 | ||
| Fwd PE | 21.75 | ||
| P/S | 2.76 | ||
| P/FCF | 26.9 | ||
| P/OCF | 24.7 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 24.09 |
EPS(TTM)3.87
EY3.91%
EPS(NY)4.55
Fwd EY4.6%
FCF(TTM)3.68
FCFY3.72%
OCF(TTM)4.01
OCFY4.05%
SpS35.91
BVpS-12.99
TBVpS-17.84
PEG (NY)3.77
PEG (5Y)2.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.73% | ||
| ROE | N/A | ||
| ROCE | 52.07% | ||
| ROIC | 40.85% | ||
| ROICexc | 96.49% | ||
| ROICexgc | N/A | ||
| OM | 12.07% | ||
| PM (TTM) | 10.83% | ||
| GM | 29.84% | ||
| FCFM | 10.25% |
ROA(3y)13.73%
ROA(5y)11.96%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)50.77%
ROIC(5y)42.31%
ROICexc(3y)99.77%
ROICexc(5y)77.41%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)64.95%
ROCE(5y)55.23%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y52.37%
ROICexc growth 5Y21.37%
OM growth 3Y1.53%
OM growth 5Y1.94%
PM growth 3Y9.8%
PM growth 5Y6.28%
GM growth 3Y0.59%
GM growth 5Y0.47%
F-Score6
Asset Turnover1.27
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 5.79 | ||
| Debt/EBITDA | 3.68 | ||
| Cap/Depr | 72.07% | ||
| Cap/Sales | 0.91% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 83.7% | ||
| Profit Quality | 94.66% | ||
| Current Ratio | 0.94 | ||
| Quick Ratio | 0.87 | ||
| Altman-Z | 3.05 |
F-Score6
WACC9.5%
ROIC/WACC4.3
Cap/Depr(3y)67.11%
Cap/Depr(5y)74.8%
Cap/Sales(3y)0.9%
Cap/Sales(5y)1.04%
Profit Quality(3y)102.86%
Profit Quality(5y)115.93%
High Growth Momentum
Growth
EPS 1Y (TTM)6.91%
EPS 3Y8.48%
EPS 5Y9.53%
EPS Q2Q%4.55%
EPS Next Y6.78%
EPS Next 2Y9.01%
EPS Next 3Y9.14%
EPS Next 5Y10.1%
Revenue 1Y (TTM)-0.88%
Revenue growth 3Y-0.09%
Revenue growth 5Y1.68%
Sales Q2Q%-2.53%
Revenue Next Year2.85%
Revenue Next 2Y3.58%
Revenue Next 3Y3.87%
Revenue Next 5Y4.18%
EBIT growth 1Y-25.28%
EBIT growth 3Y1.44%
EBIT growth 5Y3.66%
EBIT Next Year11.81%
EBIT Next 3Y9.78%
EBIT Next 5Y11.11%
FCF growth 1Y18.71%
FCF growth 3Y-3.4%
FCF growth 5Y1.65%
OCF growth 1Y18.59%
OCF growth 3Y-3.7%
OCF growth 5Y1.25%