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Does Otter Tail's Upgraded 2025 Guidance Reveal Management's Confidence in OTTR's Outlook?

Simply Wall St·11/04/2025 16:25:56
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  • On November 3, 2025, Otter Tail Corporation reported its third quarter earnings, increased its full-year 2025 earnings guidance, and declared a quarterly dividend of US$0.525 per share.
  • The company's decision to raise earnings guidance after posting a year-over-year decline in net income highlights management's confidence in future operating performance despite recent mixed results.
  • We'll explore how management's upgraded earnings outlook could influence Otter Tail's investment narrative and future expectations.

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Otter Tail Investment Narrative Recap

To be a shareholder in Otter Tail Corporation, you need to believe in the company’s ability to drive reliable long-term growth from regulated utility investments and maintain discipline in its diversified business model. Management’s move to raise 2025 earnings guidance, despite year-over-year declines in net income and revenue, does not materially alter the biggest short-term catalyst, the pace of regulatory approval and execution of major grid and renewables projects, and does not override the key risk of earning recovery lagging behind large capital outlays. Among the recent announcements, Otter Tail’s request to increase electric rates in Minnesota stands out as especially relevant. Rate recovery mechanisms remain crucial to justifying major investment plans, and any delays or challenges in obtaining approval could weigh on the earnings outlook, making this development highly connected to how catalysts and risks may play out in the near term. In contrast, investors should also be aware that approval timelines for rate increases could...

Read the full narrative on Otter Tail (it's free!)

Otter Tail's outlook anticipates $1.4 billion in revenue and $195.9 million in earnings by 2028. This is based on a projected 2.5% annual revenue growth rate, but also reflects a decrease in earnings of $90 million from current earnings of $286.2 million.

Uncover how Otter Tail's forecasts yield a $83.00 fair value, a 6% upside to its current price.

Exploring Other Perspectives

OTTR Earnings & Revenue Growth as at Nov 2025
OTTR Earnings & Revenue Growth as at Nov 2025

Four individual valuations from the Simply Wall St Community span US$0.01 to US$83 per share, offering a wide lens on Otter Tail’s fair value. These opinions appear as expectations for utility rate approvals and regulatory outcomes remain central to the future performance conversation.

Explore 4 other fair value estimates on Otter Tail - why the stock might be worth less than half the current price!

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.