Zacks Research Downgrades Worthington Steel (NYSE:WS) to Strong Sell

Key Points

• Zacks Research downgraded Worthington Steel (NYSE:WS) from "hold" to strong sell, while the three-analyst consensus remains an average "Hold" with an average price target of $46.00.
• Worthington Steel missed Q1 estimates, reporting $0.27 EPS vs. $0.47 expected and $769.8M revenue vs. $882.95M expected; the stock trades around $35.72 with a 12-month range of $23.57–$49.17 and a P/E of ~21.
• Insiders increased their holdings in January (directors bought shares) even as large institutions like Vanguard and Dimensional raised stakes, leaving institutional ownership at about 45.41%.

Worthington Steel (NYSE:WS - Get Free Report) was downgraded by equities researchers at Zacks Research from a "hold" rating to a "strong sell" rating in a research report issued on Monday,Zacks.com reports.

Other research analysts have also recently issued research reports about the stock. KeyCorp began coverage on shares of Worthington Steel in a report on Wednesday, March 25th. They issued an "overweight" rating and a $46.00 target price for the company. Weiss Ratings reissued a "hold (c)" rating on shares of Worthington Steel in a report on Monday. Finally, Wall Street Zen cut shares of Worthington Steel from a "buy" rating to a "hold" rating in a report on Saturday, April 11th. One investment analyst has rated the stock with a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat.com, the company has an average rating of "Hold" and an average price target of $46.00.

Worthington Steel Trading Up 0.1%

WS opened at $35.72 on Monday. Worthington Steel has a twelve month low of $23.57 and a twelve month high of $49.17. The company has a 50-day simple moving average of $36.45 and a 200 day simple moving average of $35.64. The company has a quick ratio of 0.90, a current ratio of 1.48 and a debt-to-equity ratio of 0.03. The stock has a market capitalization of $1.81 billion, a price-to-earnings ratio of 21.01 and a beta of 2.06.

Worthington Steel (NYSE:WS - Get Free Report) last posted its earnings results on Thursday, March 26th. The company reported $0.27 EPS for the quarter, missing analysts' consensus estimates of $0.47 by ($0.20). The company had revenue of $769.80 million during the quarter, compared to the consensus estimate of $882.95 million. Worthington Steel had a return on equity of 10.12% and a net margin of 3.64%.The firm's revenue was up 12.0% compared to the same quarter last year. During the same period last year, the company posted $0.35 EPS. Analysts predict that Worthington Steel will post 2.38 EPS for the current fiscal year.

Insider Buying and Selling

In other Worthington Steel news, Director Jon J. Bowsher acquired 2,500 shares of the company's stock in a transaction that occurred on Friday, January 30th. The stock was acquired at an average price of $40.15 per share, for a total transaction of $100,375.00. Following the acquisition, the director directly owned 17,893 shares in the company, valued at $718,403.95. This represents a 16.24% increase in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, Director Scott J. Kelly acquired 7,000 shares of the company's stock in a transaction that occurred on Tuesday, January 27th. The stock was acquired at an average price of $39.11 per share, with a total value of $273,770.00. Following the acquisition, the director owned 16,157 shares in the company, valued at $631,900.27. The trade was a 76.44% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. 2.60% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the business. Vanguard Group Inc. raised its holdings in Worthington Steel by 5.3% in the 4th quarter. Vanguard Group Inc. now owns 4,287,641 shares of the company's stock valued at $148,438,000 after buying an additional 217,090 shares during the last quarter. Dimensional Fund Advisors LP raised its holdings in Worthington Steel by 1.3% in the 3rd quarter. Dimensional Fund Advisors LP now owns 2,462,097 shares of the company's stock valued at $74,823,000 after buying an additional 32,717 shares during the last quarter. Alliancebernstein L.P. raised its holdings in Worthington Steel by 695.6% in the 3rd quarter. Alliancebernstein L.P. now owns 969,887 shares of the company's stock valued at $29,475,000 after buying an additional 847,981 shares during the last quarter. Charles Schwab Investment Management Inc. raised its holdings in Worthington Steel by 14.4% in the 4th quarter. Charles Schwab Investment Management Inc. now owns 811,832 shares of the company's stock valued at $28,106,000 after buying an additional 102,188 shares during the last quarter. Finally, American Century Companies Inc. raised its holdings in Worthington Steel by 51.3% in the 3rd quarter. American Century Companies Inc. now owns 609,810 shares of the company's stock valued at $18,532,000 after buying an additional 206,778 shares during the last quarter. Institutional investors own 45.41% of the company's stock.

Worthington Steel Company Profile

Worthington Steel NYSE: WS is a leading North American steel processor specializing in the production of flat-rolled, coated and painted sheet and coil products. Operating as a wholly owned subsidiary of Worthington Industries, the company serves a broad range of industries, including construction, automotive, appliance, energy and agricultural equipment. Its core business activities encompass the processing, finishing and distribution of carbon and advanced high-strength steels, aluminum and stainless products to manufacturers across the continent.

The company’s product portfolio includes hot-dip galvanizing, galvannealed, aluminized and pre-painted steel products, as well as cold-rolled and hot-rolled coil.

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