Otis Worldwide Corporation (NYSE:OTIS) shareholders are probably feeling a little disappointed, since its shares fell 2.6% to US$93.02 in the week after its latest quarterly results. It was a credible result overall, with revenues of US$3.4b and statutory earnings per share of US$0.86 both in line with analyst estimates, showing that Otis Worldwide is executing in line with expectations. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
Taking into account the latest results, the current consensus from Otis Worldwide's 14 analysts is for revenues of US$14.7b in 2024. This would reflect a modest 2.6% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to increase 5.6% to US$3.73. Before this earnings report, the analysts had been forecasting revenues of US$14.7b and earnings per share (EPS) of US$3.79 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at US$98.77. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Otis Worldwide at US$119 per share, while the most bearish prices it at US$79.00. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.
One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's clear from the latest estimates that Otis Worldwide's rate of growth is expected to accelerate meaningfully, with the forecast 3.5% annualised revenue growth to the end of 2024 noticeably faster than its historical growth of 0.7% p.a. over the past three years. Compare this with other companies in the same industry, which are forecast to grow their revenue 3.5% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Otis Worldwide is expected to grow at about the same rate as the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also reconfirmed their revenue estimates, with the company predicted to grow at about the same rate as the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Otis Worldwide going out to 2026, and you can see them free on our platform here..
And what about risks? Every company has them, and we've spotted 3 warning signs for Otis Worldwide (of which 1 is a bit unpleasant!) you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.