Otis Worldwide Corporation OTIS, one of the world’s leading elevator and escalator manufacturers, is set to release its highly anticipated fourth-quarter 2023 results on Jan 31, before the opening bell.
In the last reported quarter, OTIS’ earnings outshined the Zacks Consensus Estimate by 9.2% and surged 18.8% year over year. Meanwhile, net sales surpassed the consensus mark by 1.2% and grew by 5.4% year over year. Notably, Otis’ earnings have surpassed the consensus mark in each of the last 15 quarters.
For the upcoming quarter, the Zacks Consensus Estimate for earnings per share has held steady at 85 cents over the last 60 days, suggesting a 13.3% increase from the year-ago quarter.
Factors to Consider
With its strategic focus on acquisitions, product innovations, and the integration of new technologies, Otis has been augmenting its business performance. These initiatives, driven by ongoing research and development efforts, are expected to favorably impact the fourth-quarter results.
The company anticipates the new equipment margin to spike to nearly 7% in the fourth quarter from 4.9% in the year-ago period. It also expects a decline in new equipment orders alongside flat to slightly up backlog for the quarter. In addition, it projects a 5.6% growth in service revenues.
Furthermore, Otis foresees headwinds from foreign exchange translation that might impact sales and adjusted earnings in the to-be-reported quarter.
Despite the positive momentum, our proven model does not conclusively predict an earnings beat for Otis this time around. As per our analysis, the stock lacks both a positive Earnings ESP and a favorable Zacks Rank (currently holding a Zacks Rank #4).
Other Players in the Construction Sector
Here are some companies in the Construction sector that, per our model, present a favorable combination for beating earnings in the upcoming reporting period, including Louisiana-Pacific Corporation (LPX), Meritage Homes Corporation (MTH), and Vulcan Materials Company (VMC).
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As Otis gears up to unveil its latest financial numbers, investors are eagerly awaiting to see if the company has continued its remarkable performance in the fourth-quarter. The robust efforts in business expansion, innovations, and technology integrations lay a compelling groundwork for the quarter, despite apprehensions around foreign exchange impacts. Stay tuned for Otis’ earnings report to discern the way forward in the elevating world of OTIS shares.