Otis Worldwide Corp

OTIS

Electronic & Other Electrical Equipment (No Computer Equip)

Mkt Cap

$38.6B

PE

27.03

Debt

$6.923B

Cash

$887M

EV

$44.63B

FCF

$1.376B

Market Cap

$38.6B

P/E Ratio

27.03

Debt

$6.923B

Cash

$887M

EV

$44.63B

FCF

$1.376B

Charts data: {"Earnings":[{"time":"2018-12-30","value":1049000000},{"time":"2019-12-30","value":1103000000},{"time":"2020-12-30","value":906000000},{"time":"2021-12-30","value":1246000000},{"time":"2022-12-30","value":1253000000},{"time":"2023-12-30","value":1406000000}],"Sales":[{"time":"2018-12-30","value":12915000000},{"time":"2019-12-30","value":13118000000},{"time":"2020-12-30","value":12756000000},{"time":"2021-12-30","value":14298000000},{"time":"2022-12-30","value":13685000000},{"time":"2023-12-30","value":14209000000}],"Net Margins":[{"time":"2018-12-30","value":0.08122338366240806},{"time":"2019-12-30","value":0.08408293947248056},{"time":"2020-12-30","value":0.07102539981185324},{"time":"2021-12-30","value":0.08714505525248287},{"time":"2022-12-30","value":0.09156010230179028},{"time":"2023-12-30","value":0.09895136885072842}],"Assets":[{"time":"2019-12-30","value":9687000000},{"time":"2020-12-30","value":10710000000},{"time":"2021-12-30","value":12279000000},{"time":"2022-12-30","value":9819000000},{"time":"2023-12-30","value":10117000000}],"Stockholders Equity":[{"time":"2018-12-30","value":2106000000},{"time":"2019-12-30","value":2231000000},{"time":"2020-12-30","value":-3284000000},{"time":"2021-12-30","value":-3144000000},{"time":"2022-12-30","value":-4799000000},{"time":"2023-12-30","value":-4855000000}],"ROE":[{"time":"2018-12-30","value":0.49810066476733145},{"time":"2019-12-30","value":0.4943971313312416},{"time":"2020-12-30","value":-0.2758830694275274},{"time":"2021-12-30","value":-0.39631043256997456},{"time":"2022-12-30","value":-0.26109606167951654},{"time":"2023-12-30","value":-0.28959835221421215}],"ROA":[{"time":"2019-12-30","value":0.19211314132342314},{"time":"2020-12-30","value":0.15303454715219422},{"time":"2021-12-30","value":0.17167521785161657},{"time":"2022-12-30","value":0.20704756085141052},{"time":"2023-12-30","value":0.216071958090343}]}

Otis Worldwide Corporation engages in the manufacturing, installation, and servicing of elevators and escalators in the United States, China, and internationally. The company operates in two segments, New Equipment and Service. The New Equipment segment designs, manufactures, sells, and installs a range of passenger and freight elevators, as well as escalators and moving walkways for residential and commercial buildings, and infrastructure projects. This segment serves real-estate and building developers, and general contractors. The Service segment performs maintenance and repair services, as well as modernization services to upgrade elevators and escalators. Otis Worldwide Corporation was founded in 1853 and is headquartered in Farmington, Connecticut.

Sector

10-Q
9/30/23
10-Q
6/30/23
10-Q
3/31/23
10-K
12/31/22
10-Q
9/30/22
10-Q
6/30/22
10-Q
3/31/22
10-K
12/31/21
10-Q
9/30/21
10-Q
6/30/21
10-Q
3/31/21
10-K
12/31/20
10-Q
9/30/20
10-Q
6/30/20
10-Q
3/31/20

DCF

Discounted Cash Flow Valuation of Otis Worldwide Corp

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$1.376B	$1.367B	$1.358B	$1.349B	$1.34B	$1.332B	$1.323B	$1.314B	$1.306B	$1.297B	$1.289B	$12.89B
DCF		$1.189B	$1.027B	$887.2M	$766.4M	$662.1M	$572M	$494.1M	$426.9M	$368.8M	$318.6M	$3.186B
Value	$9.898B

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth 11%

Earnings Stability 12%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been increasing indicating a higher marginal ROA with respect to the calculated one, giving a good sign for continued growth.

Years	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	8.1%	8.4%	7.1%	8.7%	9.2%	9.9%	10%
ROA	-	19%	15%	17%	21%	22%	23%
ROE	50%	49%	-28%	-40%	-26%	-29%	-29%

What is the average Net Margin?

The average Net Margin over the past 5 years is +8.57%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is +0.36%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +18.8%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is +1.02%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is -3.84%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -18.07%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

The company has high debt with respect to the cashflow it generates.

The Graham’s stability indicate reliability of earnings, and consideration about the future are more dependable.

Years	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	-	0.03	4.63	4.59	5.08	4.66	5.03
Debt Equity	-	0.02	-1.83	-2.33	-1.53	-1.43	-1.40
MIN
Graham Stability	-	-	-	100%	100%	100%	100%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 5.03.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 0.97.

What is the Graham’s Stability?

Graham’s Stability measure stands at 1.00.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Earnings growth has been increasing in past years.

Years	12-2018	12-2020	12-2022	Trend
Revenue	1.9%	3.7%	3.8%	0.3%
Net Income	6%	16%	12%	3.3%
Stockholders Equity	-	-	-	-
FCF	1.6%	4.7%	3%	0.66%

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +1.93%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is +0.3%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is +6.03%.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is +3.25%.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is -.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is +1.56%.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is +0.66%.