MeritValue

Otter Tail Corp

OTTRdata completeness 100%18 fiscal years on file
The thesis, from the filings

Otter Tail Corp earns about 19% on equity, far above its ~9% cost of capital, with a roughly flat share count — a real edge showing up in the numbers. The estimate methods put fair value between $53.43 and $103.53 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.2B1$1.46B2$1.35B3$1.33B3$1.3B3
Net income$176.8M4$284.2M5$294.2M6$301.7M6$275.9M6
Operating cash flow$231.2M7$389.3M8$404.5M9$452.7M9$386M9
Capital expenditure$171.8M10$171.1M11$287.1M12$358.7M12$288.1M12
Free cash flow (derived)$59.4M7$218.2M8$117.4M9$94.1M9$97.9M9
Total debt$1.62B13$1.66B14$1.73B14$1.01B15$1.1B15
Cash & equivalents$1.54M16$119M17$230.4M18$294.7M19$386.2M19
Diluted shares41.8M41.9M42.0M42.1M42.1M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$442.04
your share of equity
Profit it earned you last year
$65.51
Free cash flow it threw off
$23.25
Debt you’d be carrying
$262.07

10 shares is a claim on $442.04 of net worth that earned you $65.51 and generated $23.25 of cash last year, against $262.07 of debt.

iii. Is this a good business?
Moat signal · return on equity
19% avg · 5y
FY21 18%FY22 23%FY23 20%FY24 18%FY25 15%

It earned about 19% on equity, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
+1% shares · 5y

Share count is roughly flat over 5 years — little dilution, little buyback. Total debt has fallen 32% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $53.43 and $103.53 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$103.53
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth18.1%
  • fcfBase$97.9M
DCF · Growth Exit 5Y
$53.43
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth18.1%
  • fcfBase$97.9M
Earnings Power Value
$69.92
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$284.2M
  • growthAssumed0.0%
Graham Number
$80.71
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years18.1%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $53.43
The three cases
Bear0.0%$16.18
Base18.1%$53.43
Bull20.0%$58.76

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 18.1%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001466593-22-000010 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001466593-25-000034 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K/A · period ending 2023-12-31 · accession 0001466593-26-000015 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001466593-24-000039 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001466593-25-000034 (NetIncomeLoss)
  6. 10-K/A · period ending 2023-12-31 · accession 0001466593-26-000015 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001466593-24-000039 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001466593-25-000034 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K/A · period ending 2023-12-31 · accession 0001466593-26-000015 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001466593-24-000039 (PaymentsToAcquireProductiveAssets)
  11. 10-K · period ending 2022-12-31 · accession 0001466593-25-000034 (PaymentsToAcquireProductiveAssets)
  12. 10-K/A · period ending 2023-12-31 · accession 0001466593-26-000015 (PaymentsToAcquireProductiveAssets)
  13. 10-K · period ending 2021-12-31 · accession 0001466593-23-000053 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001466593-24-000039 (LongTermDebtNoncurrent)
  15. 10-K/A · period ending 2024-12-31 · accession 0001466593-26-000015 (LongTermDebtCurrent)
  16. 10-K · period ending 2021-12-31 · accession 0001466593-23-000053 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2022-12-31 · accession 0001466593-24-000039 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2023-12-31 · accession 0001466593-25-000034 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K/A · period ending 2024-12-31 · accession 0001466593-26-000015 (CashAndCashEquivalentsAtCarryingValue)