OTIS
Otis Worldwide
Hybrid Industrial
★ Quality 70/100Price today
$71.27
what the market pays
Worth
$39.37
calculated cycle value
Price is 81% above its value
charlieapp.co
A monopoly position
This company has a competitive advantage so strong that its rivals find it practically impossible to replicate.
Price vs Intrinsic Value
The line is the price month by month; the green band marks when it's undervalued (−20% off value). When the price drops in there, the discount is real, not opinion.
Where does the value come from?
Manufacturing + technology
$56.31
per share
How it's calculated
Otis Worldwide — high assisted path (2026-06-07). Review note.
Net cash in the bank
cash minus financial debt, per share
Total calculated value
business + cash
How many times the cash flow
Hybrid Industrial · vs 28 peers
You pay 24.1x times this business's cash flow; its sector median is 35.5x.
36% above what Charlie thinks it's worth (15.4x) — you're overpaying, sector or no sector.
Why Overvalued?
Its free cash flow is $3.66/share × 15.4x multiplier minus $16.94 in negative net cash = $39.37 in intrinsic value. Today's price of $71.27 is 45% above the calculated value — the market is paying a premium over what the model sees as fair.
The price is 81% above the calculated value. You're paying more than it's worth.
Buying here lowers your expected return and wipes out the safety margin.
The next reasonable entry zone starts at $37.40.
At what price would buying make sense?
Entry zones
🟢 Undervalued
≤$31.50
-20% off Value
🟡 Discounted
≤$37.40
-5% off Value
🔴 Today
$71.27
-45% Valor
Overvalued
The market prices it too high versus what the business makes. Patience pays off here.
“Time is the friend of the wonderful company, the enemy of the mediocre.”
— Warren Buffett
Model updated · July 2026
The business
Sells the elevator once and charges you for maintenance for 30 years.
Otis makes, installs, and services elevators and escalators. The real business is service: ~2.3 million units under recurring maintenance contracts, which deliver most of the margin. New equipment gets a foot in the door; maintenance pays the bills for decades.
Every installed elevator becomes a 20-30 year service annuity, with retention rates above 90%. The density of its technician network and its proprietary knowledge of its installed base make switching providers expensive and risky for the customer. It's a quiet toll stuck to the building.
Revenue history
From $13.7B to $14.7B in 4 years. The business grows steadily.
Where each $100 of sales goes
Revenue $14.4B · FY2025
Of every $100 in sales, $90 goes to costs and operations; $10 is left as net profit (10% margin).
Catalysts and risks
Service portfolio growing ~4% annually with inflation repricing.
Modernization of old equipment in China and Europe: a global maintenance market of millions of aging units.
$1.4B FCF in 2025 sustains growing buybacks and dividend.
New equipment exposed to Chinese construction, which stays weak and drags sales down.
$7.8B debt against only $1.1B in cash limits room to maneuver.
Wage inflation among technicians squeezes the margin of the business that matters.
Charlie's note
“Excellent business: every installed elevator is a decades-long service annuity with 90% retention and a toll stuck to the building. But 15.4x with no growth means paying for the quality without a discount, so here it's about waiting patiently and letting the price do the work.”
Analysis · June 2026
So when would be a good price for Otis Worldwide?
By our calculation, not yet. We will email you the day it drops to $37.40 — so you do not have to keep checking.
🔔 Email meFree · no card
Charlie informs, it doesn't advise. No information should be taken as a recommendation to buy or sell.