Otis Worldwide Corporation Beat Analyst Estimates: See What The Consensus Is Forecasting For This Year
Otis Worldwide Corporation (NYSE:OTIS) defied analyst predictions to release its quarterly results, which were ahead of market expectations. Otis Worldwide beat earnings, with revenues hitting US$3.4b, ahead of expectations, and statutory earnings per share outperforming analyst reckonings by a solid 16%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.
Check out our latest analysis for Otis Worldwide
Taking into account the latest results, the consensus forecast from Otis Worldwide's nine analysts is for revenues of US$13.9b in 2021, which would reflect a credible 5.2% improvement in sales compared to the last 12 months. Statutory earnings per share are predicted to grow 15% to US$2.78. In the lead-up to this report, the analysts had been modelling revenues of US$13.5b and earnings per share (EPS) of US$2.66 in 2021. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
It will come as no surprise to learn that the analysts have increased their price target for Otis Worldwide 6.9% to US$80.20on the back of these upgrades. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values Otis Worldwide at US$88.00 per share, while the most bearish prices it at US$65.00. This is a very narrow spread of estimates, implying either that Otis Worldwide is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.
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 7.0% annualised revenue growth to the end of 2021 noticeably faster than its historical growth of 1.7% over the past year. Compare this with other companies in the same industry, which are forecast to grow their revenue 7.9% 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 important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Otis Worldwide following these results. They also upgraded their revenue forecasts, although the latest estimates suggest that Otis Worldwide will grow in line with the overall industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.
With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for Otis Worldwide going out to 2025, and you can see them free on our platform here..
We don't want to rain on the parade too much, but we did also find 3 warning signs for Otis Worldwide (1 makes us a bit uncomfortable!) that you need to be mindful of.
This article by Simply Wall St is general in nature. 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.
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