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Worthington Industries
(NYSE:WOR)
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Rating:69Neutral
Price Target:
$61.00
▲(10.61% Upside)
Action:Downgraded
Date:06/27/26
The score is driven primarily by solid financial quality and cash generation with manageable leverage, plus a supportive earnings call emphasizing strong FY2026 execution and balance-sheet flexibility. Offsetting these positives are mixed/soft technical signals and only moderate valuation support given a modest dividend yield and the company’s history of performance volatility.
Positive Factors
Free Cash Flow Generation
Record free cash flow and full conversion indicate durable cash-generation capability. This strengthens capacity to fund modernization capex, dividends, buybacks and bolt-on M&A, and provides a buffer through cyclical downswings in metals end markets over the next 2–6 months.
Negative Factors
Margin Pressure from Mix and Inventory
Mix shifts, acquisition purchase-accounting inventory step-ups and sustained commodity inflation compress margins. These structural cost exposures could weigh on EBITDA margins for several quarters until pricing, mix improvements or synergies fully offset the headwinds.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow Generation
Record free cash flow and full conversion indicate durable cash-generation capability. This strengthens capacity to fund modernization capex, dividends, buybacks and bolt-on M&A, and provides a buffer through cyclical downswings in metals end markets over the next 2–6 months.
Read all positive factors
Worthington Industries Key Performance Indicators (KPIs)
Any
Adjusted EBITDA by Segment
Shows segment-level operating profitability after adjusting for nonrecurring items, revealing which businesses generate the most cash and which are margin-constrained. Useful for assessing real cash flow strength, the impact of commodity and input-cost swings, and which segments justify higher valuation or need operational fixes.
Shows segment-level operating profitability after adjusting for nonrecurring items, revealing which businesses generate the most cash and which are margin-constrained. Useful for assessing real cash flow strength, the impact of commodity and input-cost swings, and which segments justify higher valuation or need operational fixes.
Data provided by:
The Fly
The FlyWorthington Industries (WOR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.69B
Dividend Yield1.27%
Average Volume (3M)179.88K
Price to Earnings (P/E)17.1
Beta (1Y)0.78
Revenue Growth19.72%
EPS Growth63.76%
CountryUS
Employees6,000
SectorIndustrials
Sector Strength72
IndustryManufacturing - Metal Fabrication
Share Statistics
EPS (TTM)3.19
Shares Outstanding49,252,995
10 Day Avg. Volume214,687
30 Day Avg. Volume179,883
Financial Highlights & Ratios
PEG Ratio0.28
Price to Book (P/B)2.72
Price to Sales (P/S)2.02
P/FCF Ratio11.11
Enterprise Value/Market Cap1.22
Enterprise Value/Revenue2.37
Enterprise Value/Gross Profit8.68
Enterprise Value/Ebitda14.49
Forecast
1Y Price Target
$58.50Price Target Upside6.07% Upside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)3.76
Revenue Forecast (FY)$1.47B
Worthington Industries Business Overview & Revenue Model
Company Description
Worthington Industries, Inc. is an industrial manufacturing firm operating internationally, with a strong foothold in North America. The company's primary focus areas include value-added steel processing, the production of various consumer goods, ...
How the Company Makes Money
Worthington Industries makes money primarily by processing and selling steel and other metals products and by earning income from related downstream products and investments. A core revenue stream comes from purchasing flat-rolled steel and conver...
Worthington Industries Earnings Call Summary
Earnings Call Date:Jun 23, 2026
(Q4-2026)
| % Change Since: |
Next Earnings Date:Sep 30, 2026
Earnings Call Sentiment Positive
The call conveyed a largely positive view: the company delivered strong full-year top-line growth (20%), adjusted EBITDA expansion (12%), record free cash flow ($170M), improved SG&A efficiency, and strategic M&A and product momentum (notably ASME tanks into data centers). Near-term headwinds include margin compression from mix and inventory step-up (LSI), lower equity income from ClarkDietrich, A2L-related tough comps, and elevated modernization capex, but management framed many issues as timing or comparison-driven rather than structural. Balance sheet metrics and liquidity remain strong, supporting continued execution and M&A optionality.Positive Updates
Full-Year Sales Growth
Consolidated net sales for fiscal 2026 increased 20% year-over-year to $1.4 billion, including 9% organic growth, demonstrating both portfolio strength and organic momentum.
Negative Updates
Gross Margin Compression
Gross margin declined to 27.4% in Q4 from 29.3% a year ago, driven by less favorable product mix in building products, the inventory step-up purchase accounting impact from LSI, and ongoing inflationary cost pressures.
Read all updates
Q4-2026 Updates
Positive
Negative
Full-Year Sales Growth
Consolidated net sales for fiscal 2026 increased 20% year-over-year to $1.4 billion, including 9% organic growth, demonstrating both portfolio strength and organic momentum.
Read all positive updates
Company Guidance
The company gave limited but specific forward-looking pointers: it expects to ship at least $13 million of ASME water tanks into data centers in Q1 FY2027 (matching the $13M shipped in fiscal 2026), expects to complete its consumer facility modernization by mid‑FY2027 with approximately $16 million of modernization spend remaining (after funding $25M of elevated capex in FY2026), and anticipates capital expenditures will return to more normalized levels thereafter; management said A2L-related comparison headwinds should moderate by Q2, believes ClarkDietrich is at a trough with upside potential, and reiterated a long‑term target for wholly‑owned Building Products EBITDA margins in the low‑teens (roughly 12–13%). Key financial context and balance‑sheet flexibility cited alongside that guidance included FY2026 adjusted EBITDA of $296M (up 12%), adjusted EPS of $3.37 (up 9%), free cash flow of $170M (102% conversion), Q4 free cash flow of $55M, Q4 net sales of $371M (FY sales $1.4B, +20% including 9% organic), net debt of $278M (net debt/ttm adjusted EBITDA <1x), a $500M undrawn revolver, and a quarterly dividend of $0.20/share (up 5%).Worthington Industries Financial Statement Overview
Summary
Income Statement
63
Positive
Balance Sheet
72
Positive
Cash Flow
74
Positive
| Breakdown | May 2026 | May 2025 | May 2024 | May 2023 | May 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.38B | 1.15B | 1.25B | 1.42B | 5.24B |
| Gross Profit | 378.27M | 318.26M | 285.92M | 339.37M | 602.01M |
| EBITDA | 140.58M | 179.37M | 156.49M | 291.36M | 643.81M |
| Net Income | 156.09M | 96.05M | 110.62M | 256.53M | 379.39M |
Balance Sheet | |||||
| Total Assets | 1.85B | 1.70B | 1.64B | 3.65B | 3.64B |
| Cash, Cash Equivalents and Short-Term Investments | 27.73M | 250.07M | 244.22M | 454.95M | 34.48M |
| Total Debt | 349.76M | 326.06M | 317.18M | 795.38M | 844.41M |
| Total Liabilities | 821.02M | 756.91M | 747.63M | 1.83B | 2.03B |
| Stockholders Equity | 1.03B | 937.19M | 888.88M | 1.70B | 1.48B |
Cash Flow | |||||
| Free Cash Flow | 251.75M | 159.16M | 206.45M | 539.00M | -24.49M |
| Operating Cash Flow | 226.12M | 209.74M | 289.98M | 625.36M | 70.11M |
| Investing Cash Flow | -360.07M | -135.10M | -140.81M | -71.78M | -438.19M |
| Financing Cash Flow | -88.40M | -68.79M | -359.89M | -133.13M | -237.75M |
Worthington Industries Technical Analysis
Negative
55.15
Price Trends
56.01
Negative
54.52
Positive
54.63
Negative
Market Momentum
-0.43
Positive
41.10
Neutral
21.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WOR, the sentiment is Negative. The current price of 55.15 is below the 20-day moving average (MA) of 57.66, below the 50-day MA of 56.01, and above the 200-day MA of 54.63, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 41.10 is Neutral, neither overbought nor oversold. The STOCH value of 21.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WOR.
Worthington Industries Risk Analysis
Worthington Industries disclosed 29 risk factors in its most recent earnings report. Worthington Industries reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Worthington Industries Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $4.50B | 14.18 | 24.53% | 0.67% | 4.58% | 556.92% | |
78 Outperform | $1.32B | 31.55 | 10.73% | ― | 10.67% | 30.61% | |
69 Neutral | $2.69B | 17.11 | 11.58% | 1.27% | 19.72% | 63.76% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
63 Neutral | $581.44M | 13.66 | 11.72% | 3.49% | 20.94% | 88.74% | |
58 Neutral | $855.32M | -42.51 | -6.76% | ― | -0.04% | -172.38% |
* Industrials Sector Average
WOR
Worthington Industries
54.57
-8.75
-13.82%
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Worthington Industries Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Worthington Industries Grants Long-Term Performance Awards to Executives
Positive
Jun 26, 2026
On June 22, 2026, Worthington Enterprises’ board approved special leadership retention performance share awards for four top executives, including its CFO and the presidents of its Consumer Products and Building Products segments, granting e...
Business Operations and StrategyExecutive/Board ChangesStock BuybackDividendsFinancial DisclosuresM&A Transactions
Worthington Industries Reports Strong FY2026 Results and Outlook
Positive
Jun 23, 2026
Worthington Enterprises reported on June 23, 2026, that it appointed former Louisiana-Pacific chief executive W. Bradley Southern to its board, expanding the board to 14 seats before planning to reduce it to 11 when three directors retire at the 2...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.