Worthington Steel Stock Drops After Missing Earnings Expectations
Worthington Steel (NYSE: WS) saw its stock fall by over 10% on Wednesday after reporting disappointing first-quarter earnings. The company earned $0.57 per share, missing the expected $0.68 forecast and revealing a GAAP loss of $0.14 per share. Despite tripling sales to $2.7 billion year-over-year due to its acquisition of Kloeckner, operating profit grew by only 16%, raising concerns about profitability. The impact from the Kloeckner acquisition was significant; without it, Worthington's sales growth would have been just 9% and operating profits could have declined. Management did not provide guidance for the remainder of the fiscal year, adding uncertainty to future performance. Analysts project earnings around $4.58 per share in 2027, suggesting a low price-to-earnings ratio but also highlighting Worthington's high debt load. Investors are advised caution due to declining net earnings and significant leverage. The stock is currently trading at what appears to be an attractive valuation, though the company’s financial health remains under scrutiny.
