• EN

    • -+ 0.00%
    -+ 0.00%
    -+ 0.00%

    Worthington Enterprises (WOR) Is Down 5.5% After Scrutiny Of Capital Allocation Intensifies - What's Changed

    Simply Wall St·02/24/2026 01:15:36
    Listen to the news
    • Worthington Enterprises, a US industrial manufacturer focused on steel processing and pressure cylinders, has recently been criticized for multi‑year declines in annual sales and earnings per share, alongside weakening returns on capital that have raised questions about how effectively management has allocated resources in the past.
    • This deterioration in core financial metrics has sharpened scrutiny of management’s capital deployment choices and their ability to improve the company’s operational performance.
    • Next, we’ll examine how concerns about weakening returns on capital may alter Worthington Enterprises’ previously optimistic investment narrative built around growth initiatives.

    Capitalize on the AI infrastructure supercycle with our selection of the 34 best 'picks and shovels' of the AI gold rush converting record-breaking demand into massive cash flow.

    Worthington Enterprises Investment Narrative Recap

    To own Worthington Enterprises, you need to believe its focus on steel processing, pressure cylinders and related products can still create acceptable returns despite recent sales and EPS declines. The latest data on falling returns on capital directly challenges the near term catalyst of margin improvement and makes capital allocation discipline the biggest short term risk, while existing macro and steel price risks remain in the background.

    Against this backdrop, Worthington’s ongoing share repurchase program, which has retired more than 40% of the share count since 2014, is especially relevant. While buybacks can support earnings per share and signal confidence, they also sharpen the question of whether cash would be better used on growth, automation or balance sheet strength if underlying returns on capital are under pressure.

    Yet behind the headline numbers, one risk in particular could catch investors off guard and it relates directly to...

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

    Worthington Enterprises' narrative projects $1.4 billion revenue and $213.4 million earnings by 2028. This requires 7.6% yearly revenue growth and a $117.3 million earnings increase from $96.1 million today.

    Uncover how Worthington Enterprises' forecasts yield a $67.20 fair value, a 21% upside to its current price.

    Exploring Other Perspectives

    WOR 1-Year Stock Price Chart
    WOR 1-Year Stock Price Chart

    Before this setback, the most optimistic analysts were assuming revenue of about US$1.5 billion and earnings of roughly US$224 million by 2028, which is far more upbeat than consensus and sits uneasily beside the recent deterioration in returns on capital you have just seen.

    Explore 2 other fair value estimates on Worthington Enterprises - why the stock might be worth as much as 57% more than the current price!

    Reach Your Own Conclusion

    Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

    Curious About Other Options?

    Don't miss your shot at the next 10-bagger. Our latest stock picks just dropped:

    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.