Otis Worldwide Corporation, a leading provider of elevators, escalators, and moving walkways, has made a strategic move in the Taiwan market by acquiring Jardine Schindler Lifts Limited (Taiwan) from the Jardine Schindler Group. This acquisition marks a significant milestone for Otis, bolstering its presence in Taiwan by expanding its customer reach and operational capacity.
The acquisition allows Otis to tap into a new customer base and introduce its innovative products and services, including the recently launched Otis ONE platform and the connected Gen3 elevators. The Otis ONE platform is a comprehensive digital solution that connects and manages building systems, while the Gen3 elevators are known for their advanced technology and energy efficiency.
This strategic transaction is part of Otis’ broader growth strategy, which encompasses both inorganic and organic initiatives. While the Jardine Schindler acquisition exemplifies their inorganic growth efforts, Otis also prioritizes organic growth through continuous innovation. This commitment is reflected in their substantial R&D investments. In 2023, Otis invested $144 million in R&D, and during the first half of 2024, they increased this investment to $75 million, marking a 5.6% year-over-year rise. This substantial investment highlights Otis’ determination to integrate the latest technologies into their products to remain competitive in the market.
The company has a global network of 11 R&D centers and 17 factories, strategically located in key markets like China, India, Japan, France, Germany, Spain, and the United States. These centers play a crucial role in the efficient development of engineering solutions. Furthermore, Otis employs approximately 1,200 engineers worldwide, who focus on digital initiatives, software development, design, user interfaces, and user experience.
Despite the company’s shares underperforming the industry in the year-to-date period, Otis remains committed to innovation and expansion. The company plans to continue investing in its digital ecosystem and pursuing strategic acquisitions to solidify its position in the market.
Otis Worldwide currently holds a Zacks Rank #3 (Hold). However, several other construction companies are considered better-ranked stocks. Among these, Comfort Systems USA, Inc. (FIX), Sterling Infrastructure, Inc. (STRL), and Frontdoor, Inc. (FTDR) all sport a Zacks Rank #1 (Strong Buy).
Comfort Systems USA, Inc. (FIX) has consistently delivered positive earnings surprises, with an average trailing four-quarter earnings surprise of 20.6%. The stock has experienced strong growth over the past year, rising by 64.4%. Analysts are projecting significant growth for FIX in 2024, with sales and earnings per share expected to increase by 29.4% and 57.8%, respectively, from the previous year.
Sterling Infrastructure, Inc. (STRL) also boasts a Zacks Rank #1 (Strong Buy) and an impressive average trailing four-quarter earnings surprise of 17.4%. Shares of STRL have gained 42% in the past year, and analysts are predicting continued growth in 2024, with sales and EPS expected to rise by 9.7% and 26.6%, respectively, compared to the previous year.
Frontdoor, Inc. (FTDR) rounds out the list of top-ranked construction stocks with a Zacks Rank #1 (Strong Buy). FTDR has delivered remarkable earnings surprises, with an average trailing four-quarter earnings surprise of 279%. The stock has surged by 47.7% in the past year. Analysts anticipate further growth for FTDR in 2024, with sales and EPS projected to increase by 3% and 18.7%, respectively, from the previous year.
