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1. Company Snapshot

1.a. Company Description

Worthington Industries, Inc., an industrial manufacturing company, focuses on value-added steel processing, manufactured consumer, building, and sustainable mobility products in North America and internationally.It operates through Steel Processing, Consumer Products, Building Products, and Sustainable Energy Solutions segments.The Steel Processing segment processes flat-rolled steel for customers primarily in the automotive, aerospace, agricultural, appliance, construction, container, energy, hardware, heavy-truck, HVAC, lawn and garden, leisure and recreation, office furniture, and office equipment markets.


It also toll processes steel for steel mills, large end-users, service centers, and other processors.The Consumer Products segment sells tools, outdoor living, and celebrations products under the Coleman, Bernzomatic, Balloon Time, Mag-Torch, General, Garden-Weasel, Pactool International, Hawkeye, Worthington Pro Grade, and Level5 brand names.The Building Products segment sells refrigerant and LPG cylinders, well water and expansion tanks, and other specialty products to gas producers and distributors.


The Sustainable Energy Solutions segment offers on-board fueling systems and services, as well as gas containment solutions and services for the storage, transport, and distribution of industrial gases.The company was founded in 1955 and is headquartered in Columbus, Ohio.

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1.b. Last Insights on WOR

Worthington Enterprises' recent performance was negatively impacted by its Q1 earnings miss, with quarterly earnings of $0.74 per share falling short of the Zacks Consensus Estimate of $0.8 per share. Despite an 18% increase in net sales to $303.7 million, the company's earnings lagged expectations. Additionally, the company's dividend payout of $0.19 per share, although a steady income source for shareholders, did not offset the earnings disappointment. The company's sustainability report and upcoming dividend increases may not be enough to counterbalance the negative earnings surprise.

1.c. Company Highlights

2. Worthington Enterprises Delivers Strong Q1 FY2026 Results

Worthington Enterprises reported a robust start to fiscal 2026, with sales reaching $304 million, an 18% increase from $257 million in the prior year quarter. The growth was primarily driven by higher volumes in the Building Products segment and the inclusion of Elgen, which contributed $21 million to sales. Gross profit rose to $82 million, with a gross margin of 27.1%, despite a $2.2 million purchase accounting charge related to Elgen. Adjusted EBITDA was $65 million, up 34% from $48 million in Q1 last year, with an adjusted EBITDA margin of 21.4%. Earnings per share (EPS) came in at $0.74, slightly below estimates of $0.8.

Publication Date: Oct -28

📋 Highlights
  • Strong YoY Sales Growth: Q1 sales rose 18% to $304 million, driven by Building Products segment (+32% to $185 million) and Elgen acquisition ($21 million contribution).
  • Adjusted EBITDA Surge: Adjusted EBITDA jumped 34% to $65 million (21.4% margin), with Building Products achieving 31.3% margin ($58 million EBITDA).
  • Robust Cash Flow Generation: Operated $41 million cash flow from operations and $28 million free cash flow, supporting $0.19/share dividend (payable in Dec 2025).
  • Cost Efficiency Gains: Gross margin improved to 27% (vs. 24% prior year) despite $2.2 million Elgen accounting charge, targeting >30% margin medium-term.
  • Strategic M&A Momentum: Elgen acquisition added $21 million revenue (breakeven EBITDA) and aligns with growth in commercial HVAC/structural framing markets.

Segment Performance

The company's Consumer Products segment saw sales of $119 million, up 1% from the prior year quarter, with adjusted EBITDA of $16 million and a margin of 13.6%. The Building Products segment delivered sales of $185 million, up 32% year-over-year, with adjusted EBITDA of $58 million and a margin of 31.3%. The acquisition of Elgen contributed to growth, with its integration progressing well, driven by market normalization, share gains, and new product launches.

Cash Flow and Balance Sheet

The company generated $41 million in cash flow from operations and $28 million in free cash flow during the quarter. With a strong balance sheet, low leverage, and ample liquidity, Worthington Enterprises is well-positioned for growth and returning value to shareholders. The Board of Directors declared a quarterly dividend of $0.19 per share payable in December 2025.

Outlook and Valuation

The company is optimistic about its prospects, citing a strong portfolio of market-leading brands and a culture of innovation. Analysts estimate next year's revenue growth at 15.4%. With a current P/E Ratio of 25.93 and EV/EBITDA of 15.26, the market is pricing in a certain level of growth. The company's focus on operational efficiency and cost reduction initiatives is expected to drive better results across the portfolio. As Joseph Hayek noted, "we are focused on being smarter and more nimble, investing in AI, automation, and analytics while keeping an eye on expenses."

Growth Initiatives

Worthington Enterprises is making progress on new product lines, including Balloon Time Mini, and expanding distribution at retail. The company's WAVE business is seeing some challenges, but expects this to be a temporary period of uncertainty. The acquisition of Elgen is off to a good start, with opportunities for growth and synergy in commercial HVAC and structural framing.

3. NewsRoom

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Worthington Enterprises Schedules Fiscal Second Quarter 2026 Earnings Call for December 17

Dec -02

Source: globenewswire.com

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Creative Planning Increases Stake in Worthington Enterprises, Inc. $WOR

Nov -29

Source: defenseworld.net

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Worthington Enterprises Participating in Baird Global Industrial Conference

Nov -05

Source: globenewswire.com

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Y Intercept Hong Kong Ltd Acquires 11,846 Shares of Worthington Enterprises, Inc. $WOR

Nov -03

Source: defenseworld.net

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Ethic Inc. Sells 2,624 Shares of Worthington Enterprises, Inc. $WOR

Oct -29

Source: defenseworld.net

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Reviewing BlueLinx (NYSE:BXC) & Worthington Enterprises (NYSE:WOR)

Oct -26

Source: defenseworld.net

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Worthington Enterprises: Better To Remain Patient For Now

Sep -26

Source: seekingalpha.com

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Worthington Enterprises Post Earnings: A Buying Opportunity

Sep -24

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (1.83%)

6. Segments

Steel Processing

Expected Growth: 1.8%

Worthington Industries' Steel Processing segment growth of 1.8% is driven by increasing demand from automotive and construction industries, supported by rising infrastructure spending and vehicle production. Additionally, the company's focus on value-added products, such as coated and painted steel, contributes to growth.

Consumer Products

Expected Growth: 1.5%

Worthington Industries, Inc.'s Consumer Products segment growth of 1.5% is driven by increasing demand for outdoor recreational products, such as camping gear and BBQ accessories, as well as a growing trend towards DIY home improvement projects, which boosts sales of its pressure cylinders and propane tanks.

Building Products

Expected Growth: 2.2%

Worthington Industries' Building Products segment growth of 2.2% is driven by increasing demand for sustainable and energy-efficient building solutions, rising construction activities in the residential and commercial sectors, and strategic acquisitions expanding product offerings and geographic reach.

Sustainable Energy Solutions

Expected Growth: 2.5%

Worthington Industries' Sustainable Energy Solutions segment growth is driven by increasing demand for clean energy, government incentives for renewable energy adoption, and rising energy efficiency standards. Additionally, the company's strategic acquisitions and partnerships, such as its joint venture with Nikola Motor, position it for growth in the alternative fuel and electric vehicle markets.

7. Detailed Products

Pressure Cylinders

Worthington Industries, Inc. manufactures high-pressure cylinders for the storage and transportation of industrial gases, medical oxygen, and compressed natural gas (CNG) for vehicles.

Industrial Gas Tanks

The company designs and manufactures industrial gas tanks for the storage of liquefied gases, including propane, butane, and anhydrous ammonia.

Cryogenic Tanks

Worthington Industries, Inc. produces cryogenic tanks for the storage of liquefied gases, including liquid nitrogen, oxygen, and argon.

Alternative Fuel Systems

The company offers alternative fuel systems, including compressed natural gas (CNG) and liquefied petroleum gas (LPG) fuel systems for vehicles.

Oil and Gas Equipment

Worthington Industries, Inc. manufactures oil and gas equipment, including wellhead tanks, oilfield trailers, and production equipment.

Consumer Products

The company produces consumer products, including propane cylinders, torches, and accessories for outdoor recreation and household use.

8. Worthington Industries, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Worthington Industries, Inc. operates in a industry where substitutes are available, but they are not a significant threat to the company's operations. The company's products are highly specialized and are not easily substitutable.

Bargaining Power Of Customers

Worthington Industries, Inc. has a diverse customer base, which reduces the bargaining power of individual customers. The company's products are also highly customized, which makes it difficult for customers to switch to alternative suppliers.

Bargaining Power Of Suppliers

Worthington Industries, Inc. relies on a few key suppliers for raw materials, which gives them some bargaining power. However, the company's large scale of operations and diversified supply chain mitigate this risk.

Threat Of New Entrants

The steel processing industry has high barriers to entry, including significant capital requirements and regulatory hurdles. This makes it difficult for new entrants to enter the market and compete with Worthington Industries, Inc.

Intensity Of Rivalry

The steel processing industry is highly competitive, with several large players competing for market share. Worthington Industries, Inc. faces intense competition from rivals, which puts pressure on prices and margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 31.93%
Debt Cost 4.32%
Equity Weight 68.07%
Equity Cost 10.53%
WACC 8.54%
Leverage 46.90%

11. Quality Control: Worthington Industries, Inc. passed 9 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

55.25$

Current Price

55.25$

Potential

-0.00%

Expected Cash-Flows