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Relative valuation derived from Utilities sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 50GRADE C+
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
16.6%
Sector: 9.9%
Dividend Analysis audit
INCOME
2.49%
Trailing Yield
$2.49
Per $100 Invested
Solid dividend yield for income-focused strategies.
Est. Payout Ratio
31%SAFE
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, Otter Tail Corp (OTTR) receives a "Hold" rating with a composite score of 49.7/100, ranked #351 out of 4446 stocks. Key factor scores: Quality 50/100, Value 67/100, Momentum 49/100. This is quantitative analysis only — not investment advice.
Otter Tail Corp (OTTR) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does Otter Tail Corp Do?
Otter Tail Corporation, together with its subsidiaries, engages in electric utility, manufacturing, and plastic pipe businesses in the United States. The company's Electric segment produces, transmits, distributes, and sells electric energy in Minnesota, North Dakota, and South Dakota; and operates as a participant in the Midcontinent Independent System Operator, Inc. markets. This segment generates electricity through coal, wind and hydro, and natural gas. It serves approximately 133,000 residential, industrial, and other commercial customers. Its Manufacturing segment engages in the contract machining, metal parts stamping, fabrication and painting, and production of plastic thermoformed horticultural containers, life science and industrial packaging, and material handling components, and extruded raw material stock for recreational vehicle, agricultural, construction, lawn and garden, and industrial and energy equipment industries. It also manufactures clamshell packing, blister packs, returnable pallets, and handling trays for shipping and storing odd-shaped or difficult-to-handle parts for customers in the horticulture, medical and life sciences, industrial, recreation, and electronics industries. The company's Plastics segment manufactures polyvinyl chloride pipes for municipal water, rural water, wastewater, storm drainage and water reclamation system, and other uses. This segment markets its products to wholesalers and distributors through independent sales representatives, company salespersons, and customer service representatives. The company was formerly known as Otter Tail Power Company and changed its name to Otter Tail Corporation in 2001. Otter Tail Corporation was founded in 1907 and is headquartered in Fergus Falls, Minnesota. Otter Tail Corp (OTTR) is classified as a mid-cap stock in the Utilities sector. The company is led by CEO Charles S. MacFarlane and employs approximately 2,420 people, headquartered in FERGUS FALLS, Minnesota. With a market capitalization of $3.7B, OTTR is one of the notable companies in the Utilities sector.
Otter Tail Corp (OTTR) Stock Rating — Hold (April 2026)
As of April 2026, Otter Tail Corp receives a Hold rating with a composite score of 49.7/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.OTTR ranks #351 out of 4,446 stocks in our coverage universe. Within the Utilities sector, Otter Tail Corp ranks #35 of 112 stocks, placing it in the upper half of its Utilities peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
OTTR Stock Price and 52-Week Range
Otter Tail Corp (OTTR) currently trades at $90.28. The stock lost $0.65 (0.7%) in the most recent trading session. The 52-week high for OTTR is $90.41, which means the stock is currently trading -0.1% from its annual peak. The 52-week low is $71.79, putting the stock 25.8% above its annual trough. Recent trading volume was 155K shares, suggesting relatively thin trading activity.
Is OTTR Overvalued or Undervalued? — Valuation Analysis
Otter Tail Corp (OTTR) carries a value factor score of 67/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 12.29x, compared to the Utilities sector average of 23.47x — a discount of 48%. The price-to-book ratio stands at 2.04x, versus the sector average of 1.98x. The price-to-sales ratio is 2.85x, compared to 0.82x for the average Utilities stock. On an enterprise value basis, OTTR trades at 12.37x EV/EBITDA, versus 4.75x for the sector.
Overall, OTTR's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
Otter Tail Corp Profitability — ROE, Margins, and Quality Score
Otter Tail Corp (OTTR) earns a quality factor score of 50/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 16.6%, compared to the Utilities sector average of 9.9%, which is within a healthy range. Return on assets (ROA) comes in at 7.8% versus the sector average of 3.1%.
On a margin basis, Otter Tail Corp reports gross margins of 46.0%, compared to 53.1% for the sector. The operating margin is 28.9% (sector: 21.5%). Net profit margin stands at 23.2%, versus 12.8% for the average Utilities stock. Revenue growth is running at -4.8% on a trailing basis, compared to 20.1% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
OTTR Debt, Balance Sheet, and Financial Health
Otter Tail Corp has a debt-to-equity ratio of 52.0%, compared to the Utilities sector average of 164.5%. Leverage is within a manageable range for the industry, though investors should monitor debt trends over time. The current ratio is 2.28x, indicating strong short-term liquidity. Total debt on the balance sheet is $964M. Cash and equivalents stand at $326M.
OTTR has a beta of 0.45, meaning it is less volatile than the S&P 500, making it a relatively defensive holding. The stability factor score for Otter Tail Corp is 89/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
Otter Tail Corp Revenue and Earnings History — Quarterly Trend
In TTM 2026, Otter Tail Corp reported revenue of $1.33B and earnings per share (EPS) of $6.59. Net income for the quarter was $310M. Gross margin was 46.0%. Operating income came in at $386M.
In FY 2025, Otter Tail Corp reported revenue of $1.30B and earnings per share (EPS) of $6.59. Net income for the quarter was $276M. Revenue grew -2.3% year-over-year compared to FY 2024. Operating income came in at $346M.
In Q3 2025, Otter Tail Corp reported revenue of $326M and earnings per share (EPS) of $1.87. Net income for the quarter was $78M. Revenue grew -3.4% year-over-year compared to Q3 2024. Operating income came in at $97M.
In Q2 2025, Otter Tail Corp reported revenue of $332M and earnings per share (EPS) of $1.86. Net income for the quarter was $78M. Revenue grew -2.9% year-over-year compared to Q2 2024. Operating income came in at $97M.
Over the past 8 quarters, Otter Tail Corp has demonstrated a growth trajectory, with revenue expanding from $342M to $1.33B. Investors analyzing OTTR stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
OTTR Dividend Yield and Income Analysis
Otter Tail Corp (OTTR) currently pays a dividend yield of 2.5%. At this yield, a $10,000 investment in OTTR stock would generate approximately $$249.00 in annual dividend income. This compares to the Utilities sector average dividend yield of 2.8%, meaning OTTR yields less than the typical sector peer. With a net margin of 23.2%, the dividend appears well-covered by earnings, suggesting sustainable payouts going forward.
OTTR Momentum and Technical Analysis Profile
Otter Tail Corp (OTTR) has a momentum factor score of 49/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 35/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 1/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
OTTR vs Competitors — Utilities Sector Ranking and Peer Comparison
Comparing OTTR against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full OTTR vs S&P 500 (SPY) comparison to assess how Otter Tail Corp stacks up against the broader market across all factor dimensions.
OTTR Next Earnings Date
No upcoming earnings date has been announced for Otter Tail Corp (OTTR) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy OTTR? — Investment Thesis Summary
Otter Tail Corp presents a balanced picture with arguments on both sides. The value score of 67/100 suggests attractive pricing relative to fundamentals. Low volatility (stability score 89/100) reduces downside risk.
In summary, Otter Tail Corp (OTTR) earns a Hold rating with a composite score of 49.7/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on OTTR stock.
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Institutional Research Dossier
Otter Tail Corp (OTTR) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Otter Tail Corp (OTTR) receives a Hold rating, reflecting a balanced assessment of its strengths and weaknesses. While the company exhibits strong profitability metrics and operates at a compelling valuation relative to its peers, concerns regarding revenue contraction and modest growth prospects temper our enthusiasm. The company's diversified business model, spanning electric utilities, manufacturing, and plastics, provides a degree of resilience, but its ability to consistently generate free cash flow and navigate evolving regulatory landscapes will be crucial in determining its long-term performance.
The Hold rating acknowledges Otter Tail's demonstrated operational efficiency and attractive valuation multiples, particularly its low P/E and EV/EBITDA ratios compared to the utilities sector. However, the recent revenue decline and relatively low investment score suggest potential headwinds in future growth and capital allocation strategies. Investors should closely monitor the company's ability to adapt to changing market conditions and execute its strategic initiatives to unlock further value.
Business Strategy & Overview
Otter Tail Corporation operates across three distinct segments: Electric, Manufacturing, and Plastics. The Electric segment, the core of the business, generates, transmits, and distributes electricity in Minnesota, North Dakota, and South Dakota. This segment leverages a diversified generation portfolio including coal, wind, hydro, and natural gas, allowing it to adapt to changing fuel costs and environmental regulations. Otter Tail operates within the Midcontinent Independent System Operator (MISO) market, participating in regional energy markets to optimize power dispatch and manage grid reliability. The company serves a substantial customer base of approximately 133,000 residential, industrial, and commercial customers, providing a stable revenue stream.
The Manufacturing segment engages in contract machining, metal parts stamping, fabrication, painting, and the production of plastic thermoformed containers. This segment caters to a diverse range of industries, including recreational vehicle, agricultural, construction, lawn and garden, and industrial and energy equipment. The Manufacturing segment's strategy focuses on providing customized solutions and value-added services to its clients, fostering long-term relationships and recurring revenue streams. The breadth of its customer base mitigates the risk of over-reliance on any single industry or client.
The Plastics segment manufactures polyvinyl chloride (PVC) pipes for various applications, including municipal water, rural water, wastewater, storm drainage, and water reclamation systems. This segment markets its products through a network of wholesalers, distributors, independent sales representatives, and company salespersons. The Plastics segment benefits from the ongoing investment in water infrastructure across the United States, driven by aging infrastructure and increasing demand for water resources. The company's focus on quality and reliability positions it favorably in this competitive market.
Otter Tail's overall strategy centers on diversification, operational efficiency, and strategic investments in its core businesses. The company aims to achieve sustainable growth by leveraging its diversified revenue streams, optimizing its cost structure, and pursuing strategic acquisitions and organic growth opportunities. The company's commitment to environmental stewardship and renewable energy sources is also a key component of its long-term strategy, aligning with evolving regulatory requirements and customer preferences.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
-4.8%
Sector: 20.1%
-124% VS SCTR
Economic Moat Analysis
Otter Tail possesses a narrow economic moat, primarily derived from its regulated electric utility operations. The Electric segment benefits from a geographically concentrated service territory in Minnesota, North Dakota, and South Dakota, where it enjoys a degree of natural monopoly. The high capital costs and regulatory hurdles associated with building and operating electric transmission and distribution infrastructure create a barrier to entry for potential competitors. This allows Otter Tail to earn relatively stable returns on its invested capital, subject to regulatory oversight.
The regulatory environment provides a degree of pricing power, as regulators typically allow utilities to recover their costs and earn a reasonable rate of return. However, this pricing power is not unlimited, as regulators also have a mandate to protect consumers from excessive rates. The regulatory process can be complex and time-consuming, and regulatory decisions can impact the company's profitability and investment decisions. The company's participation in the MISO market also provides access to a broader pool of resources and opportunities for energy trading, further enhancing its competitive position.
The Manufacturing and Plastics segments operate in more competitive markets, where Otter Tail's competitive advantage is less pronounced. These segments rely on product differentiation, customer service, and operational efficiency to maintain their market share and profitability. While these segments contribute to the company's overall diversification, they do not possess the same level of economic moat as the Electric segment. The Manufacturing segment benefits from its ability to provide customized solutions and value-added services, fostering long-term relationships with its clients. The Plastics segment benefits from its focus on quality and reliability, which are important considerations for customers in the water infrastructure market.
Overall, Otter Tail's narrow economic moat is primarily attributable to its regulated electric utility operations. While the Manufacturing and Plastics segments contribute to the company's diversification, they do not possess the same level of competitive advantage. The company's ability to maintain its economic moat will depend on its ability to navigate the evolving regulatory landscape, maintain its operational efficiency, and continue to provide reliable and affordable energy to its customers.
Financial Health & Profitability
Otter Tail's financial health presents a mixed picture. The company demonstrates strong profitability metrics, with a TTM Net Income of $275.89 million and an impressive Net Margin of 23.2%, significantly exceeding the sector average of 12.8%. The Operating Margin of 28.9% also surpasses the sector average of 21.7%, indicating efficient operations. The Return on Equity (ROE) of 16.6% is notably higher than the sector average of 10.0%, showcasing the company's ability to generate profits from shareholder equity. However, the TTM Free Cash Flow (FCF) is negative at -$91.59 million, raising concerns about the company's ability to self-fund its operations and growth initiatives.
The company's balance sheet exhibits a healthy Current Ratio of 2.28, indicating strong liquidity and the ability to meet its short-term obligations. Total Cash stands at $325.79 million, providing a buffer against unforeseen circumstances. However, Total Debt is significant at $963.57 million, resulting in a Debt-to-Equity (D/E) ratio of 52.00, which is considerably lower than the sector average of 165.00. This suggests that Otter Tail is less leveraged than its peers, providing a degree of financial flexibility.
Analyzing the Quarterly Financial History reveals a recent trend of declining revenue. The TTM Revenue is $1.30 billion, lower than the FY2024 Revenue of $1.33 billion and the FY2023 Revenue of $1.35 billion. This revenue contraction is a cause for concern, as it may indicate weakening demand or increased competition. However, the Net Income has remained relatively stable, suggesting that the company has been able to mitigate the impact of the revenue decline through cost management and operational efficiencies. The Operating Margin has also remained consistently strong, ranging from 23.8% to 33.8% over the past several quarters.
In summary, Otter Tail exhibits strong profitability and a healthy balance sheet, but the recent revenue decline and negative free cash flow warrant close monitoring. The company's ability to reverse the revenue trend and generate positive free cash flow will be crucial in determining its long-term financial health and sustainability. The company's lower leverage compared to its peers provides a degree of financial flexibility, but it also limits its ability to pursue aggressive growth strategies.
Valuation Assessment
Otter Tail's valuation appears attractive relative to its peers in the utilities sector. The company's P/E ratio of 12.8x is significantly lower than the sector average of 22.7x, suggesting that the stock is undervalued based on its earnings. Similarly, the EV/EBITDA ratio of 3.3x is considerably lower than the sector average of 4.8x, further supporting the notion that the stock is undervalued based on its enterprise value and earnings before interest, taxes, depreciation, and amortization. These valuation metrics suggest that investors may be overlooking the company's strong profitability and operational efficiency.
However, it is important to consider the company's recent revenue decline and negative free cash flow when assessing its valuation. The revenue contraction may indicate that the company's growth prospects are limited, which could justify a lower valuation multiple. The negative free cash flow raises concerns about the company's ability to self-fund its operations and growth initiatives, which could also weigh on its valuation. Investors may be discounting the stock due to these concerns.
The company's Stability score of 90/100 suggests that the stock is relatively less volatile compared to its peers, which may appeal to risk-averse investors. However, the Momentum score of 47/100 indicates that the stock's price performance has been lackluster, which may deter momentum investors. The Investment score of 35/100 suggests that the company's capital allocation and growth strategies are not particularly compelling, which could also weigh on its valuation.
Overall, Otter Tail's valuation appears attractive based on its P/E and EV/EBITDA ratios, but the recent revenue decline, negative free cash flow, and modest growth prospects warrant caution. The stock may be undervalued due to investor concerns about these factors. Investors should carefully consider the company's growth potential and ability to generate positive free cash flow before making an investment decision. A discounted valuation may be warranted given the headwinds the company faces.
Risk & Uncertainty
Otter Tail faces several risks and uncertainties that could impact its financial performance and stock price. One significant risk is regulatory uncertainty, particularly in the Electric segment. Changes in environmental regulations, such as stricter emission standards or mandates for renewable energy, could increase the company's operating costs and capital expenditures. Regulatory decisions regarding rate increases and cost recovery could also impact the company's profitability. The company's ability to navigate the regulatory landscape and obtain favorable outcomes will be crucial in maintaining its financial health.
Another risk is competition in the Manufacturing and Plastics segments. These segments operate in competitive markets, where Otter Tail faces competition from other manufacturers and suppliers. Increased competition could lead to lower prices, reduced market share, and decreased profitability. The company's ability to differentiate its products and services, maintain its operational efficiency, and foster strong customer relationships will be essential in mitigating this risk.
A third risk is commodity price volatility. The Electric segment is exposed to fluctuations in the prices of coal, natural gas, and other fuels used to generate electricity. Significant increases in fuel prices could increase the company's operating costs and reduce its profitability. The company's ability to manage its fuel costs through hedging strategies and diversification of its generation portfolio will be important in mitigating this risk. The Plastics segment is also exposed to fluctuations in the price of PVC resin, which is a key raw material. Supply chain disruptions could also impact the availability and cost of raw materials.
Finally, the company's reliance on a relatively small geographic area in Minnesota, North Dakota, and South Dakota exposes it to regional economic downturns and weather-related events. A severe drought or other natural disaster could disrupt the company's operations and reduce demand for its products and services. The company's ability to diversify its revenue streams and mitigate the impact of regional economic and weather-related events will be important in ensuring its long-term sustainability.
Bulls Say / Bears Say
The Bull Case
BULL VIEWOtter Tail's low P/E and EV/EBITDA ratios compared to the sector indicate significant undervaluation, presenting an attractive entry point for value investors.
BULL VIEWThe company's diversified business model, spanning electric utilities, manufacturing, and plastics, provides resilience and reduces reliance on any single industry or market.
The Bear Case
BEAR VIEWThe recent revenue decline and negative free cash flow raise concerns about Otter Tail's growth prospects and ability to self-fund its operations.
BEAR VIEWRegulatory uncertainty and potential increases in environmental compliance costs could significantly impact the profitability of the Electric segment.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score OTTR and 4,400+ other equities.
Otter Tail Corp exhibits a 90% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
7.8%
Sector: 3.1%
Gross Margin
Pricing power and cost efficiency
46.0%
Sector: 53.1%
Operating Margin
Core business profitability
28.9%
Sector: 21.5%
Net Margin
Bottom-line profitability
23.2%
Sector: 12.8%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield2.83%
Yield Delta-12%
Income Projection audit
A $10,000 investment would generate approximately $249 annually in dividends at the current trailing rate.
Otter Tail (OTTR) Valuation Check After Rate Settlement Approval And Earnings Slowdown Forecast
The South Dakota Public Utilities Commission’s approval of Otter Tail (OTTR) subsidiary Otter Tail Power’s rate settlement, which includes a moratorium on further base rate hikes until late 2029, gives investors a clearer view of future regulated revenue.
See our latest analysis for Otter Tail.
Against this regulatory backdrop, Otter Tail’s share price has eased in the very short term, with a 7 day share price return of 3.89% and a 30 day share price return of 0.54%. However, its 1 year total...
