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OTIS Launches the Digitally Connected Gen3 Core Elevator

Otis Worldwide Corporation OTIS launched the new Gen3 Core elevator under the Gen3 umbrella. The digitally native elevator is designed explicitly to fit in with North America's growing demand for two-to-six-story buildings.

The Gen3 Core elevator is built with certified design and flat-belt technology inspired by the company’s Gen2 elevators family. The new product is equipped with the Otis ONE IoT (Internet of Things) platform, along with the integration of various products like Otis eView in-cab screens. Customers may opt for application programming interface integration into tenant apps and other smart building systems.

The new product will be certified with an Environmental Product Declaration and manufactured at the North American Manufacturing Center of Excellence in Florence, SC. The company is optimistic about the launch of the Gen3 Core elevator as it aims at providing comfort and the various benefits of digital connectivity and predictive services to the low-rise segment.

Zacks Investment Research
Zacks Investment Research


Image Source: Zacks Investment Research

Shares of OTIS have increased 17.5% in the past year compared with the Zacks Building Products - Miscellaneous industry’s growth of 18.7%. Although the shares of the company have underperformed its industry in the past year, the rise in the New Equipment backlog and portfolio is likely to increase the growth momentum in the upcoming periods.

Focus on Growth Strategies

Otis’ primary focus on innovation is the core of its strategy. In 2022, the company maintained its research and development investment by investing $150 million, especially in product innovation with its Gen3 offering.

Also, the Otis ONE IoT digital service platform is one of the company’s impressive innovations that serves for its efficiency and provides a competitive edge over its peers. Otis ONE is designed to continuously monitor equipment health and performance in real time to provide proactive, predictive and transparent information to technicians and customers. The technology expands predictive and remote maintenance capabilities to support improved elevator up-time and service productivity.

The company is consistently focused on increasing its New Equipment segment’s backlog through various operational enhancements. In the first quarter of 2023, the New Equipment segment’s orders were up 7% at the constant currency rate, with 15% growth in the Americas, a 1% rise in the EMEA and a 27% rise in the Asia Pacific. Also, the backlog was up 3%, and the adjusted backlog increased 10% at constant currency from the prior-year period.

Zacks Rank & Other Key Picks

OTIS currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks that investors may consider from the Construction sector include Martin Marietta Materials, Inc. MLM, Vulcan Materials Company VMC and Watsco, Inc. WSO.

Martin Marietta currently sports a Zacks Rank #1 (Strong Buy). MLM delivered a trailing four-quarter earnings surprise of 31%, on average. Shares of the company have rallied 25.9% in the year-to-date period. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for MLM’s 2023 sales and EPS indicates growth of 19% and 32.1%, respectively, from the previous year’s reported levels.

Vulcan Materials currently sports a Zacks Rank #1. VMC has a trailing four-quarter earnings surprise of 7.1%, on average. Shares of the company have risen 17.8% in the year-to-date period.

The Zacks Consensus Estimate for VMC’s 2023 sales and EPS indicates growth of 5.9% and 26.2%, respectively, from the previous year’s reported levels.

Watsco currently carries a Zacks Rank #2. WSO delivered a trailing four-quarter earnings surprise of 5.3%, on average. Shares of the company have rallied 40% in the year-to-date period.

The Zacks Consensus Estimate for WSO’s 2023 sales and EPS indicates growth of 3.1% and 2.2%, respectively, from the previous year’s reported levels.

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