Otis Worldwide (Otis Worldwide) Interest Coverage : 12.36 (As of Mar. 2024)

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What is Otis Worldwide Interest Coverage?

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Otis Worldwide's Operating Income for the three months ended in Mar. 2024 was $544 Mil. Otis Worldwide's Interest Expense for the three months ended in Mar. 2024 was $-44 Mil. Otis Worldwide's interest coverage for the quarter that ended in Mar. 2024 was 12.36. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Otis Worldwide's Interest Coverage or its related term are showing as below:

OTIS' s Interest Coverage Range Over the Past 10 Years
Min: 13.43 Med: 15.5 Max: No Debt
Current: 13.77

OTIS's Interest Coverage is ranked better than
50.07% of 2303 companies
in the Industrial Products industry
Industry Median: 13.77 vs OTIS: 13.77

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Otis Worldwide Interest Coverage Historical Data

The historical data trend for Otis Worldwide's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Otis Worldwide Interest Coverage Chart

Otis Worldwide Annual Data

Trend

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

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46.51

13.43

15.50

14.22

14.57

Otis Worldwide Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Interest Coverage	Get a 7-Day Free Trial															15.55	15.65	14.64	12.76	12.36

Competitive Comparison of Otis Worldwide's Interest Coverage

For the Specialty Industrial Machinery subindustry, Otis Worldwide's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Otis Worldwide's Interest Coverage Distribution in the Industrial Products Industry

For the Industrial Products industry and Industrials sector, Otis Worldwide's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Otis Worldwide's Interest Coverage falls into.

Otis Worldwide Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Otis Worldwide's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Otis Worldwide's Interest Expense was $-150 Mil. Its Operating Income was $2,186 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,158 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	2186	/	-150
	=	14.57

Otis Worldwide's Interest Coverage for the quarter that ended in Mar. 2024 is calculated as

Here, for the three months ended in Mar. 2024, Otis Worldwide's Interest Expense was $-44 Mil. Its Operating Income was $544 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,130 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Mar. 2024 )	/	Interest Expense (Q: Mar. 2024 )
	=	-1	*	544	/	-44
	=	12.36

The higher the ratio, the stronger the company's Financial Strength is.

Otis Worldwide (NYSE:OTIS) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Otis Worldwide Interest Coverage Related Terms

Thank you for viewing the detailed overview of Otis Worldwide's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Otis Worldwide (Otis Worldwide) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » Otis Worldwide Corp (NYSE:OTIS) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

OTIS:Mexico 4PG:Germany 4PG:Germany O1TI34:Brazil

Address

One Carrier Place, Farmington, CT, USA, 06032

Website

https://www.otis.com

Otis is the largest global elevator and escalator supplier by revenue with around 18% global market share. In 1854 Otis' founder and namesake Elisha Graves Otis, invented a safety mechanism that prevented elevators from falling if the hoisting cable failed. The company's product and service lifecycle begins with installations of elevator units in new buildings, later selling maintenance services on the units, and eventually replacement of the units after the average 15- to 20-year useful life of an elevator. As the largest global OEM, Otis has amassed an installed base under service that exceeds 2 million elevators. Its business model is similar to that of its closest competitors Kone, Schindler, and TK Elevator.

Executives

Thomas A Bartlett	director	116 HUNTINGTON AVENUE, BOSTON MA 02116
Jill Brannon	director	942 S. SHADY GROVE ROAD, MEMPHIS TN 38120
Tracy A Embree	officer: President, Otis Americas	500 JACKSON STREET, COLUMBUS IN 47201
Viseras Enrique Minarro	officer: President, Otis EMEA	C/O INGERSOLL RAND INC., 525 HARBOUR PLACE DRIVE, SUITE 600, DAVIDSON NC 28036
Fernandez Bernardo Calleja	officer: President, Otis EMEA	1 CARRIER PLACE, FARMINGTON CT 06032
Michael Patrick Ryan	officer: VP, CAO and Controller	10 FARM SPRINGS ROAD, FARMINGTON CT 06032
Sally Loh	officer: President, Otis China	1 CARRIER PLACE, FARMINGTON CT 06032
James F. Cramer	officer: President, Otis Americas	1 CARRIER PLACE, FARMINGTON CT 06032
Nora E. Lafreniere	officer: EVP, Chief GC & Corp. Sec.	ONE CARRIER PLACE, FARMINGTON CT 06032
Montlivault Stephane De	officer: President, Otis Asia Pacific	ONE CARRIER PLACE, FARMINGTON CT 06032
Peiming Zheng	officer: President, Otis China	ONE CARRIER PLACE, FARMINGTON CT 06032
Nelda J Connors	director	BOSTON SCIENTIFIC CORPORATION, 300 BOSTON SCIENTIFIC WAY, MARLBOROUGH MA 01752-1234
Anurag Maheshwari	officer: EVP and CFO	1 CARRIER PLACE, FARMINGTON CT 06032
Rahul Ghai	officer: EVP & Chief Financial Officer	GENERAL ELECTRIC COMPANY, 5 NECCO STREET, BOSTON MA 02210
Abbe Luersman	officer: EVP & CPO	1 CARRIER PLACE, FARMINGTON CT 06032