OTIS: 2Q26 Abridged Earnings Transcript

研报英文原文证据摘录

OTIS: 2Q26 Abridged Earnings Transcript

July 22, 2026

Investment Conclusion

Otis Worldwide Corporation (OTIS): Peer Perform Rating; YE26 Fair Value Range of $65-102

180 Investment Thesis

Attractive Industry Profile: The E&E industry is stable, cash generative and

160 capital light, with industry profits driven by a highly regulated service business

(~75% EBITDA).

140 New Equipment Challenges Continue: New equipment order rates have been

trending negative over the past couple of years, dragged down by the China

real estate recession, W Europe construction weakness and lower US multi-

100 family. However, we may be approaching a point of stability entering 2026.

Margin Headwinds Becoming More Pronounced: EBITDA margins could decline

80 Y/Y in FY26, marking the first year of decline as a public company in light of cost

pressures related to investment spending (hiring of ~1k new mechanics),

60 negative mix, and material cost & freight inflation. Otis is notably prioritizing

growth acceleration vs. margin improvement. Jan-22 Apr-22 Jul-22 Oct-22 Jan-23 Apr-23 Jul-23 Oct-23 Jan-24 Apr-24 Jul-24 Oct-24 Jan-25 Apr-25 Jul-25 Oct-25 Jan-26 Apr-26 Jul-26 PP Rating: The recent verbal downgrade to 1Q/2Q26 earnings guidance (calling

EE/MI S&P500 OTIS for 3-5% Y/Y decline) was surprising and suggests heavier margin pressure than

we had figured. We now sit below Street and see further risk to 2H26e, pushing

Source: Wolfe Research, FactSet

out the catalyst path for multiple expansion.

Price Target Methodology

Bull Case

Organic Growth (CAGR: '24-'27) 3% Potential Catalysts

OM Expansion ('24-'27) 40bps New Order Inflection: China is a major sentiment driver so signs of stimulus-

related improvement would be a positive. Free cash flow has also been