Otis Worldwide Corporation ( OTIS Quick Quote OTIS - Free Report) is scheduled to report second-quarter 2022 results on Jul 27, before the opening bell. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 2.7% and rose 6.9% year over year. Net sales missed the consensus mark by 0.5% but improved 0.2% year over year. Otis’ earnings topped the consensus mark in all the last nine quarters. The Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share moved down to 78 cents in the past 30 days. The estimated figure indicates a 1.3% decline from the year-ago quarter’s level. The consensus mark for net sales is pegged at $3.54 billion, suggesting a 4.3% decrease from the year-ago reported figure of $3.70 billion.
Key Factors to Note
The world's leading elevator and escalator manufacturing, installation and service company is expected to have registered tepid sales and earnings in the second quarter. The downside was mainly due to the softness in the Americas and Asia and inflationary pressure.
Otis is improving the business on the back of various strategies like acquisitions, product innovations, and new technologies through continuous research and development. New Equipment is expected to have higher revenue in the second quarter. Yet, the Zacks Consensus Estimate for New Equipment revenues is pegged at $1.58 billion, which indicates a decrease of 8.3% from $1.73 billion in the year-ago period. For Service, revenues are expected to have increased in the quarter to be reported. The Zacks Consensus Estimate for Service revenues is pegged at $1.96 billion, which indicates a slight fall of 0.9% from $1.97 billion in the year-ago period. Headwinds like commodity inflation and the absence of temporary cost actions are likely to have put pressure on the bottom line. The company expects tough organic growth and sequentially similar earnings performance in the businesses in the to-be-reported quarter. Also, currency headwinds are likely to have added to the woes. The consensus mark for adjusted operating profit for the New Equipment unit indicates a fall of 25.2%, while that of Service suggests 2.7% year-over-year growth. What the Zacks Model Unveils
Our proven model doesn’t conclusively predict an earnings beat for Otis this time around. That is because a stock needs to have both a positive
Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. This is not the case here. Earnings ESP: The company has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter. Zacks Rank: Currently, Otis carries a Zacks Rank #5 (Strong Sell). You can see the complete list of today’s Zacks #1 Rank stocks here. Stocks With Favorable Combination
Here are some companies in the Zacks
Construction sector, which according to our model, have the right combination of elements to post an earnings beat in their respective quarters to be reported. United Rentals, Inc. ( URI Quick Quote URI - Free Report) has an Earnings ESP of +11.38% and carries a Zacks Rank #3. URI’s earnings topped the consensus mark in two of the last four quarters but missed on the other two occasions, with the average surprise being 2.3%. Earnings for the to-be-reported quarter are expected to grow 34.4% year over year. Armstrong World Industries, Inc. ( AWI Quick Quote AWI - Free Report) has an Earnings ESP of +1.02% and a Zacks Rank #3. AWI’s earnings topped the consensus mark twice but missed the same on the other two occasions, with the average negative surprise being 0.2%. Earnings for the to-be-reported quarter are expected to grow 16.7% year over year. Watsco, Inc. ( WSO Quick Quote WSO - Free Report) has an Earnings ESP of +4.32% and a Zacks Rank #3. WSO’s earnings topped the consensus mark in all the last four quarters, with the average being 24.3%. Earnings for the to-be-reported quarter are expected to grow 35.7% year over year. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.