Otter Tail falls 8.9% after third-quarter earnings miss and narrower guidance

What happened

Otter Tail (OTTR) fell 8.9% on November 3, 2026, after third-quarter results missed expectations and management tightened its 2026 adjusted diluted EPS guidance range while keeping the midpoint unchanged. The stock closed at $83.41 after it opened 2.2% below the previous close, and trading was heavy at 3.2 times its 20-day average. The S&P 500 on the day rose 0.4% while the Industrials sector median on the day rose 0.4%, leaving the stock 9.2 percentage points worse than the sector median.

How big was the move

The decline was striking for Otter Tail: it was 5.7 times a typical daily move for this stock, and the session volume at 3.2 times its 20-day average signaled clear selling pressure. Over the last five sessions the stock fell 7.8%, versus the S&P 500 over five sessions which fell 2.0%. The reaction was notable given the company's low market sensitivity; its beta of 0.35 indicates the stock typically moves less than the broader market, so such a large single-day drop points to company-specific news driving the move.

The technical picture

The stock traded below its short-, medium- and long-term averages, with the price 6.6% below its 20-day average, 6.5% below its 50-day average and 6.1% below its 200-day average. The 50-day average remained above the 200-day average, a sign of an established uptrend despite the recent pullback. The Relative Strength Index (14 days) read 31, inside the neutral 30-to-70 range, and the stock was 12.3% below its 52-week high. Over one month the stock fell 5.7% and over three months it fell 10.2%; over one year it rose 8.0%, which lagged the S&P 500 by 2.6 percentage points.

Fundamentals and valuation

For the four quarters through September 30, 2026, Otter Tail reported revenue of $1.31 billion, which grew 0.8% from a year earlier. Diluted earnings per share for that period were $4.18, with earnings per share growth from a year earlier down 37.0%. Gross margin was 38.3% compared with 43.0% a year earlier, and operating margin was 15.1% versus 26.5% a year earlier. Free-cash-flow margin stood at 9.3% and return on invested capital was 5.5%, while the balance sheet showed net debt of 3.0 times EBITDA.

Valuation measures placed the stock at 20.0 times trailing earnings and 13.7 times expected earnings on a forward basis. The price-to-trailing-earnings reading is higher than 95% of its own readings over the past five years, with a five-year median of 12.5 times earnings. Free-cash-flow yield was 3.2% and market value was $3.79 billion. Together, those measures imply a relatively full valuation compared with the company's own history even as operating metrics have softened.

PromtFinance scores gave the company a Value score of 31 (Weak), Growth 6 (Very weak) and Quality 73 (Positive), while Stability scored 90 (Exceptional). The combination reflects steady balance-sheet traits alongside weakening profitability and weak growth momentum.

Earnings and analyst expectations

Otter Tail reported third-quarter diluted earnings per share of $1.41 for the quarter ended September 30, 2026, down from $1.86 a year earlier and below the Zacks Consensus Estimate of $1.57. Management pointed to weaker PVC pipe pricing and higher input costs in its Plastics segment as headwinds. Business Wire and Seeking Alpha reported the results.

The facts file records the last report as dated November 2, 2026, with earnings per share of $1.41 against $1.55 expected, 9.0% below estimates. The company has 0 consecutive quarters beating estimates, though the average surprise over the last four reports is 7.2% above estimates. Historically, the typical two-day reaction after recent reports was that the stock rose 1.2%, a pattern that did not hold this quarter.

Seven analysts cover the stock, with a consensus rating of Hold and a consensus price target of $81.00, which is 2.9% below the closing price. No analysts rate the stock Buy or Strong Buy.

What to watch

• February 15, 2027: Next report date.
• Third-quarter diluted earnings per share of $1.41 for the quarter ended September 30, 2026, down from $1.86 a year earlier.
• Management cited weaker PVC pipe pricing and higher input costs in its Plastics segment as headwinds when tightening its 2026 adjusted diluted EPS guidance range while keeping the midpoint unchanged.
• Price to trailing earnings at 20.0 times trailing earnings, higher than 95% of its own readings over the past five years (five-year median: 12.5 times earnings).