Otis Worldwide Corporation has fallen 19% year to date after cutting its 2026 adjusted earnings per share guidance to $4.01-$4.05 from $4.20-$4.24 and lowering adjusted operating profit guidance to about $2.4 billion from about $2.5 billion. The stock now trades at 16.1 times forward 12-month earnings, a discount to its five-year median of 23.01 times and below the Zacks sub-industry multiple of 21.55 times. Adjusted free cash flow guidance was also reduced to $1.50-$1.55 billion from $1.60-$1.65 billion, while net sales guidance was maintained at $15.1-$15.3 billion, indicating weaker conversion of sales into profit and cash flow. Second-quarter adjusted operating margin contracted 180 basis points to 15.2%, with Service margin down 170 basis points to 23.2% and New Equipment margin down 220 basis points to 3.1%. The company repurchased roughly $800 million of shares in the first half and raised its dividend 5%, offering a 2.5% yield, providing partial downside support. Otis currently carries a Zacks Rank #4 (Sell), reflecting ongoing estimate revisions and margin execution risk.
Otis Worldwide CorpGuidance cuts for 2026 EPS, operating profit, and free cash flow; margin contraction; Zacks Sell rating
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