Today we're going to take a closer look at Large-Cap Technology company Otis Worldwide, whose shares are currently trading at $93.04. We've been asking ourselves whether the company is under or over valued at today's prices... let's perform a brief value analysis to find out!
Otis Worldwide Shares Are Inexpensive:
Otis Worldwide Corporation engages in manufacturing, installation, and servicing of elevators and escalators in the United States, China, and internationally. The company belongs to the Technology sector, which has an average price to earnings (P/E) ratio of 30.01. In contrast, Otis Worldwide has a trailing 12 month P/E ratio of 24.4 based on its earnings per share of $3.82.
Otis Worldwide has moved -0.8% over the last year compared to 6.5% for the S&P 500 -- a difference of -7.3%. Otis Worldwide has a 52 week high of $106.83 and a 52 week low of $89.7.
The Company's Revenues Are Declining:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $13,118 | $12,756 | $14,298 | $13,685 | $14,209 | $14,261 |
| Gross Margins | 14% | 13% | 15% | 15% | 15% | 16% |
| Net Margins | 9% | 7% | 9% | 9% | 10% | 12% |
| Net Income (M) | $1,116 | $906 | $1,246 | $1,253 | $1,406 | $1,645 |
| Net Interest Expense (M) | $14 | -$122 | -$136 | -$143 | -$150 | $31 |
| Depreciation & Amort. (M) | $85 | $191 | $203 | $191 | $193 | $120 |
| Diluted Shares (M) | 433 | 435 | 431 | 423 | 415 | 404 |
| Earnings Per Share | $2.55 | $2.08 | $2.89 | $2.96 | $3.39 | $4.07 |
| EPS Growth | n/a | -18.43% | 38.94% | 2.42% | 14.53% | 20.06% |
| Free Cash Flow (M) | $1,324 | $1,297 | $1,594 | $1,445 | $1,489 | $1,437 |
| CAPEX (M) | $145 | $183 | $156 | $115 | $138 | $126 |
| Total Debt (M) | $5 | $5,262 | $7,273 | $7,299 | $6,898 | $9,624 |
| Net Debt / EBITDA | -0.76 | 1.9 | 2.47 | 2.75 | 2.36 | 3.44 |
| Current Ratio | 1.05 | 0.97 | 1.32 | 0.9 | 0.99 | 0.99 |
Otis Worldwide has slight revenue growth and decreasing reinvestment in the business, slimmer gross margins than its peers, and not enough current assets to cover current liabilities because its current ratio is 0.99. On the other hand, the company benefits from positive EPS growth and generally positive cash flows. Furthermore, Otis Worldwide has significant leverage levels.
