Otter Tail Reports $6.55 EPS and Sets 2026 Guidance of $5.22–$5.62
Otter Tail delivered 2025 diluted EPS of $6.55 with a 16% return on equity and maintained a 63% equity ratio while electric segment revenues rose 8.1% to $566.8 million. The company initiated 2026 EPS guidance of $5.22–$5.62, projects 12% ROE at midpoint and reaffirms a 10% five-year rate base CAGR.
1. 2025 Financial Performance
Otter Tail posted diluted EPS of $6.55 in 2025, achieving a 16% return on equity on a 63% equity ratio. Results benefited from favorable weather, improved fuel recovery and operational efficiencies across utility and business segments.
2. 2026 Guidance and Long-Term Targets
Management initiated 2026 diluted EPS guidance of $5.22 to $5.62 with a projected 12% ROE at the midpoint. The company reaffirmed a 10% five-year rate base compounded annual growth rate and is targeting 7–9% annual EPS growth for a 10–12% total shareholder return.
3. Segment Results
Electric segment revenues increased 8.1% to $566.8 million, driven by higher residential and commercial sales volumes and fuel recovery revenues, boosting net income by 7.3%. The manufacturing segment saw an 8.2% revenue decline and a 15.8% net income drop amid soft end-market demand, though order momentum improved late in the year.
4. Cash Flow and Liquidity
Operating cash flow was $386.0 million versus $452.7 million in 2024, with 2025 capital expenditures of $288.1 million mainly in wind repowering and solar projects. Otter Tail ended the year with $705.5 million of total available liquidity, including $319.3 million under credit facilities and $386.2 million in cash.