What Is Otis Worldwide Corporation's (NYSE:OTIS) Share Price Doing?

Today we're going to take a look at the well-established Otis Worldwide Corporation (NYSE:OTIS). The company's stock saw significant share price movement during recent months on the NYSE, rising to highs of US$86.93 and falling to the lows of US$77.40. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Otis Worldwide's current trading price of US$80.64 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Otis Worldwide’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

View our latest analysis for Otis Worldwide

What Is Otis Worldwide Worth?

The stock seems fairly valued at the moment according to my valuation model. It’s trading around 3.97% above my intrinsic value, which means if you buy Otis Worldwide today, you’d be paying a relatively reasonable price for it. And if you believe the company’s true value is $77.56, there’s only an insignificant downside when the price falls to its real value. What's more, Otis Worldwide’s share price may be more stable over time (relative to the market), as indicated by its low beta.

Can we expect growth from Otis Worldwide?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by 35% over the next couple of years, the future seems bright for Otis Worldwide. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What This Means For You

Are you a shareholder? OTIS’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?

Are you a potential investor? If you’ve been keeping an eye on OTIS, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

If you want to dive deeper into Otis Worldwide, you'd also look into what risks it is currently facing. When we did our research, we found 3 warning signs for Otis Worldwide (1 doesn't sit too well with us!) that we believe deserve your full attention.

If you are no longer interested in Otis Worldwide, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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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.