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    Can Worthington (WOR) Overcome Margin Pressures Despite Strong Sales and Shareholder Returns?

    Simply Wall St·09/27/2025 19:14:03
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    • Worthington Enterprises, Inc. recently reported its first-quarter fiscal 2026 results, posting 18% year-over-year sales growth to US$303.71 million and net income of US$35.15 million, with contributions from the Elgen Manufacturing acquisition and new product launches.
    • Despite solid operational gains, earnings and revenue did not meet consensus expectations, and management pointed to tariff costs and macroeconomic headwinds affecting profitability amid ongoing share buybacks and continued dividend payments.
    • We’ll now examine how recent earnings shortfalls despite strong revenue growth influence Worthington Enterprises’ future investment narrative and outlook.

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    Worthington Enterprises Investment Narrative Recap

    To be a shareholder in Worthington Enterprises, you need conviction in the company's ability to drive steady growth through acquisitions and new product innovation, even as operational headwinds challenge near-term profitability. The recent earnings shortfall, despite double-digit revenue gains and contributions from Elgen Manufacturing, puts a spotlight on the balance between expansion strategies and persistent external risks, such as tariffs and wider macroeconomic pressures. These news events do not materially alter the main catalyst: integration and margin impact from acquisitions remain at the forefront; the largest risk is that trade and input cost headwinds could compress profitability if not managed.

    Among recent company announcements, the completion of a 100,000 share buyback for US$6.3 million stands out. This move, together with ongoing dividends, signals a continued commitment to shareholder returns at a time when consistently improving margins and successful M&A integration are critical for supporting the growth narrative.

    In contrast, investors should remain mindful of how quickly tariff-related costs or operational disruptions can...

    Read the full narrative on Worthington Enterprises (it's free!)

    Worthington Enterprises is projected to reach $1.4 billion in revenue and $213.4 million in earnings by 2028. This outlook is based on an expected annual revenue growth rate of 7.6% and a $117.3 million increase in earnings from the current $96.1 million.

    Uncover how Worthington Enterprises' forecasts yield a $69.00 fair value, a 27% upside to its current price.

    Exploring Other Perspectives

    WOR Community Fair Values as at Sep 2025
    WOR Community Fair Values as at Sep 2025

    Simply Wall St Community members have fair value estimates for Worthington Enterprises ranging from US$69 to US$96, reflecting a variety of approaches to potential growth. Some highlight innovation and recent acquisitions as possible drivers, but ongoing tariff costs are a reminder that views on the company’s outlook differ widely, be sure to consider multiple perspectives when making decisions.

    Explore 2 other fair value estimates on Worthington Enterprises - why the stock might be worth as much as 77% more than the current price!

    Build Your Own Worthington Enterprises Narrative

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.