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Otis Worldwide Corporation (OTIS)
Intrinsic Value (DCF)
Current$90.35
→
Intrinsic$52.91
-41%
$31.14$52.91$94.30
Market implies 21% growth for 5 years
Current price reflects execution expectations above 10% growth — not unreasonable for quality businesses.
At $90, the market prices in continued strong cash flow growth (21%) — likely reflecting buybacks, margin stability, and ecosystem strength.
Range: Bear $31 → Bull $94. Current price implies expectations above the base case, closer to bull expectations.
| Discount ↓Growth → | 6% | 8% | 10% | 12% |
|---|---|---|---|---|
| 8% | $66 | $73 | $81 | $90 |
| 10% | $42 | $47 | $53 | $59 |
| 12% | $29 | $33 | $37 | $42 |
| 14% | $21 | $24 | $27 | $31 |
Bull Case
- Bull case ($94) offers 4% upside at 11% growth, 9% discount
- Conservative 10% growth assumption is achievable based on track record
Bear Case
- Bear case ($31) implies 66% downside at 8% growth, 12% discount
- Price reflects 21% growth expectations vs 10% historical — high bar to clear
- Trading 41% above base case — execution must exceed assumptions to justify
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5-Year Free Cash Flow Projection
Year 1$1.57B
Year 2$1.73B
Year 3$1.89B
Year 4$2.07B
Year 5$2.27B
Terminal$33.40B
📐 Model Inputs
Growth Rate9.6%5Y CAGR (cascade: 5Y→3Y→TTM)
Discount Rate10.0%WACC estimate
Terminal Growth3.0%Perpetuity rate
Base Free Cash Flow$1.44BTTM actual
Bear g×0.8, r+2%
Base Historical CAGR
Bull g×1.2, r−1.5%
DCF estimates based on historical growth rates extrapolated forward. See FAQ below for full methodology.