NYSE:WOR

Stock Analysis Report

Worthington Industries

Executive Summary

Worthington Industries, Inc., a metals manufacturing company, focuses on value-added steel processing and manufactured metal products in the United States, Austria, Canada, Mexico, Poland, Portugal, and Turkey.

Rewards

Trading at 25.2% below its fair value

Earnings are forecast to grow 26.12% per year

Risk Analysis

Has a high level of debt

Unstable dividend track record

Large one-off items impacting financial results

Profit margins (2.6%) are lower than last year (5.5%)



Snowflake Analysis

Adequate balance sheet average dividend payer.


Similar Companies

Share Price & News

How has Worthington Industries's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WOR has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.9%

WOR

2.2%

US Metals and Mining

0.03%

US Market


1 Year Return

2.9%

WOR

11.8%

US Metals and Mining

18.6%

US Market

Return vs Industry: WOR underperformed the US Metals and Mining industry which returned 11.8% over the past year.

Return vs Market: WOR underperformed the US Market which returned 18.6% over the past year.


Shareholder returns

WORIndustryMarket
7 Day2.9%2.2%0.03%
30 Day1.2%3.2%1.7%
90 Day8.0%10.8%5.7%
1 Year5.5%2.9%15.2%11.8%21.1%18.6%
3 Year-27.3%-31.5%1.9%-3.5%45.6%36.2%
5 Year23.6%11.5%30.5%20.0%71.1%52.3%

Price Volatility Vs. Market

How volatile is Worthington Industries's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Worthington Industries undervalued compared to its fair value and its price relative to the market?

25.2%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WOR ($39.4) is trading below our estimate of fair value ($52.65)

Significantly Below Fair Value: WOR is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: WOR is poor value based on its PE Ratio (23.7x) compared to the Metals and Mining industry average (12.3x).

PE vs Market: WOR is poor value based on its PE Ratio (23.7x) compared to the US market (18.5x).


Price to Earnings Growth Ratio

PEG Ratio: WOR is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: WOR is overvalued based on its PB Ratio (2.7x) compared to the US Metals and Mining industry average (1.6x).


Next Steps

Future Growth

How is Worthington Industries forecast to perform in the next 1 to 3 years based on estimates from 3 analysts?

26.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WOR's forecast earnings growth (26.1% per year) is above the savings rate (1.7%).

Earnings vs Market: WOR's earnings (26.1% per year) are forecast to grow faster than the US market (14.2% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: WOR's revenue (1.2% per year) is forecast to grow slower than the US market (7.4% per year).

High Growth Revenue: WOR's revenue (1.2% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WOR's Return on Equity is forecast to be low in 3 years time (16.8%).


Next Steps

Past Performance

How has Worthington Industries performed over the past 5 years?

10.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WOR has a large one-off loss of $40.4M impacting its August 31 2019 financial results.

Growing Profit Margin: WOR's current net profit margins (2.6%) are lower than last year (5.5%).


Past Earnings Growth Analysis

Earnings Trend: WOR's earnings have grown by 10.3% per year over the past 5 years.

Accelerating Growth: WOR's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WOR had negative earnings growth (-54.1%) over the past year, making it difficult to compare to the Metals and Mining industry average (0.7%).


Return on Equity

High ROE: WOR's Return on Equity (11.4%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Worthington Industries's financial position?


Financial Position Analysis

Short Term Liabilities: WOR's short term assets ($1.0B) exceed its short term liabilities ($482.7M).

Long Term Liabilities: WOR's short term assets ($1.0B) exceed its long term liabilities ($992.5M).


Debt to Equity History and Analysis

Debt Level: WOR's debt to equity ratio (77.1%) is considered high.

Reducing Debt: WOR's debt to equity ratio has increased from 69.8% to 77.1% over the past 5 years.

Debt Coverage: WOR's debt is well covered by operating cash flow (33.1%).

Interest Coverage: WOR's interest payments on its debt are well covered by EBIT (3.1x coverage).


Balance Sheet

Inventory Level: WOR has a high level of physical assets or inventory.

Debt Coverage by Assets: WOR's debt is covered by short term assets (assets are 1.5x debt).


Next Steps

Dividend

What is Worthington Industries's current dividend yield, its reliability and sustainability?

2.44%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Worthington Industries before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company2.4%marketbottom25%1.4%markettop25%3.7%industryaverage2.3%forecastin3Years2.5%

Current dividend yield vs market & industry

Notable Dividend: WOR's dividend (2.44%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: WOR's dividend (2.44%) is low compared to the top 25% of dividend payers in the US market (3.7%).


Stability and Growth of Payments

Stable Dividend: WOR's dividend payments have been volatile in the past 10 years.

Growing Dividend: WOR's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (55.9%), WOR's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WOR's dividends in 3 years are forecast to be well covered by earnings (24.9% payout ratio).


Next Steps

Management

What is the CEO of Worthington Industries's salary, the management and board of directors tenure and is there insider trading?

1.3yrs

Average management tenure


CEO

John McConnell (65yo)

26.5yrs

Tenure

US$3,738,833

Compensation

Mr. John P. McConnell has been the Chairman of the Board of Worthington Industries, Inc. since September 1996 and Chief Executive Officer since June 1993 at Worthington Cylinder Corporation. Mr. McConnell  ...


CEO Compensation Analysis

Compensation vs Market: John's total compensation ($USD3.74M) is about average for companies of similar size in the US market ($USD3.87M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Management Age and Tenure

1.3yrs

Average Tenure

60yo

Average Age

Experienced Management: WOR's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Age and Tenure

17.5yrs

Average Tenure

66.5yo

Average Age

Experienced Board: WOR's board of directors are seasoned and experienced ( 17.5 years average tenure).


Insider Trading

Insider Buying: WOR insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$36,96006 Nov 19
Jeffrey Klingler
EntityIndividual
Shares961
Max PriceUS$38.46
BuyUS$997,06802 Jul 19
John Blystone
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares25,000
Max PriceUS$40.00
BuyUS$916,75020 Dec 18
John Blystone
EntityIndividual
Role
Lead Director
Lead Independent Director
Shares25,000
Max PriceUS$36.67

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Andy Rose (49yo)

    President

    • Tenure: 1.3yrs
    • Compensation: US$6.50m
  • John McConnell (65yo)

    Chairman of the Board & CEO

    • Tenure: 26.5yrs
    • Compensation: US$3.74m
  • Dale Brinkman (66yo)

    Senior VP of Administration

    • Tenure: 21yrs
    • Compensation: US$1.19m
  • Virgil Winland (71yo)

    Senior Vice President of Manufacturing

    • Tenure: 18.9yrs
    • Compensation: US$1.26m
  • Joe Hayek (47yo)

    VP & CFO

    • Tenure: 1.1yrs
    • Compensation: US$1.08m
  • Cathy Lyttle (60yo)

    Senior VP & Chief Human Resources Officer

    • Tenure: 1.3yrs
  • Sonya Higginbotham

    Vice President of Corporate Communications & Brand Management

    • Tenure: 1.3yrs
  • Geoff Gilmore (47yo)

    Executive VP

    • Tenure: 1.3yrs
    • Compensation: US$5.40m
  • Matt Schlabig

    Chief Information Officer

    • Tenure: 4.6yrs
  • Marcus Rogier

    Investor Relations Officer & Treasurer

    • Tenure: 1.3yrs

Board Members

  • John Blystone (65yo)

    Lead Independent Director

    • Tenure: 12.9yrs
    • Compensation: US$294.13k
  • John McConnell (65yo)

    Chairman of the Board & CEO

    • Tenure: 26.5yrs
    • Compensation: US$3.74m
  • Kerrii Anderson (62yo)

    Independent Director

    • Tenure: 9.3yrs
    • Compensation: US$199.75k
  • Mike Endres (71yo)

    Independent Director

    • Tenure: 20.9yrs
    • Compensation: US$199.75k
  • Peter Karmanos (76yo)

    Independent Director

    • Tenure: 22.9yrs
    • Compensation: US$209.75k
  • Mary Schiavo (63yo)

    Independent Director

    • Tenure: 21.9yrs
    • Compensation: US$199.75k
  • Sidney Ribeau (72yo)

    Independent Director

    • Tenure: 19.9yrs
    • Compensation: US$199.75k
  • Mark Davis (59yo)

    Independent Director

    • Tenure: 8.8yrs
    • Compensation: US$199.75k
  • Carl Nelson (73yo)

    Independent Director

    • Tenure: 15.1yrs
    • Compensation: US$214.75k
  • Ozey Horton (68yo)

    Independent Director

    • Tenure: 8.5yrs
    • Compensation: US$199.75k

Company Information

Worthington Industries, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Worthington Industries, Inc.
  • Ticker: WOR
  • Exchange: NYSE
  • Founded: 1955
  • Industry: Steel
  • Sector: Materials
  • Market Cap: US$2.109b
  • Shares outstanding: 55.92m
  • Website: https://www.worthingtonindustries.com

Number of Employees


Location

  • Worthington Industries, Inc.
  • 200 Old Wilson Bridge Road
  • Columbus
  • Ohio
  • 43085
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WORNYSE (New York Stock Exchange)YesCommon SharesUSUSDDec 1972
WTHDB (Deutsche Boerse AG)YesCommon SharesDEEURDec 1972

Biography

Worthington Industries, Inc., a metals manufacturing company, focuses on value-added steel processing and manufactured metal products in the United States, Austria, Canada, Mexico, Poland, Portugal, and Tu ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/08 23:46
End of Day Share Price2019/12/06 00:00
Earnings2019/08/31
Annual Earnings2019/05/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.