Illinois Tool Works vs Otis Worldwide
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KIRA’s take AI analyst
I put Illinois Tool Works and Otis Worldwide side by side, using each one’s latest annual report. Here is what stands out:
- Illinois Tool Works is the larger business, with $16.0B of revenue in fiscal 2025 against $14.4B for Otis Worldwide.
- Illinois Tool Works kept more of each dollar of sales as operating profit (26.3% operating margin, against 14.8%).
- Illinois Tool Works turned more of its sales into free cash flow (16.9% FCF margin, against 10.0%).
- Otis Worldwide earned a higher return on the capital invested in it (116.6%, against 30.2%).
- Investors pay more for each dollar of Illinois Tool Works’s earnings: a P/E of 25.0x against 19.3x for Otis Worldwide.
Who comes out ahead
Of the 9 measures where higher (or lower) is clearly better, how many each company leads.
Illinois Tool Works
ITW
6/9
5-year growthOperating marginNet marginFCF marginPiotroski F-scoreNet debt / EBITDA
Otis Worldwide
OTIS
3/9
Revenue growthReturn on capitalShare count change
Side by side
Best in the row
| Latest fiscal year | ITW FY25 | OTIS FY25 |
|---|---|---|
| Size | ||
| Market cap | $79.3B | $28.9B |
| Revenue | $16.0B | $14.4B |
| Free cash flow | $2.7B | $1.4B |
| Net income | $3.1B | $1.4B |
| Growth | ||
| Revenue growth | 0.9% | 1.2% |
| 5-year growth | 5.0% | 2.5% |
| Share count change | −1.9% | −2.4% |
| Profitability | ||
| Gross margin | 52.9% | — |
| Operating margin | 26.3% | 14.8% |
| Net margin | 19.1% | 9.6% |
| FCF margin | 16.9% | 10.0% |
| Return on capital | 30.2% | 116.6% |
| Return on equity | 93.7% | — |
| Balance sheet | ||
| Net debt | $8.1B | $6.9B |
| Net debt / EBITDA | 1.8x | 3.0x |
| Dividends and buybacks | $3.3B | $1.5B |
| Valuation & quality | ||
| P/E | 25.0x | 19.3x |
| Piotroski F-score | 6 | 5 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.