Have you been paying attention to shares of Otis Worldwide (OTIS)? Shares have been on the move with the stock up 3.9% over the past month. The stock hit a new 52-week high of $92.93 in the previous session. Otis Worldwide has gained 3.3% since the start of the year compared to the 5.2% move for the Zacks Construction sector and the 8.6% return for the Zacks Building Products - Miscellaneous industry.

What's Driving the Outperformance?

The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on January 31, 2024, Otis Worldwide reported EPS of $0.87 versus consensus estimate of $0.85.

For the current fiscal year, Otis Worldwide is expected to post earnings of $3.87 per share on $14.71 billion in revenues. This represents a 9.32% change in EPS on a 3.52% change in revenues. For the next fiscal year, the company is expected to earn $4.28 per share on $15.42 billion in revenues. This represents a year-over-year change of 10.81% and 4.82%, respectively.

Valuation Metrics

Otis Worldwide may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.

Otis Worldwide has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.

In terms of its value breakdown, the stock currently trades at 23.9X current fiscal year EPS estimates, which is a premium to the peer industry average of 18.8X. On a trailing cash flow basis, the stock currently trades at 22.5X versus its peer group's average of 14.4X. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Zacks Rank

We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Otis Worldwide currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.