Canaccord Genuity, on Monday, revised upwards its price target for Worthington Industries (NYSE:WOR), marking a new target of $64, up from the former $56, while continuing to suggest a cautious ‘Hold’ stance on the stock. This adjustment comes in the wake of the company’s release of its third-quarter financial outcomes last Wednesday, post-market close, marking its initial reporting period subsequent to divesting its steel division.
This quarter showcased Worthington Industries in a robust light, underscoring solid operational metrics despite sales not fully meeting analyst projections by a margin of about 3%. The firm excelled in profitability, outstripping the market consensus with its gross margin and Adjusted EBITDA margin surpassing expectations by 115 basis points and 350 basis points, respectively.
The financial spotlight shone bright on Worthington with its adjusted earnings per share (EPS) of $0.80, significantly surpassing the anticipated consensus of $0.69. The uplift in the price target reflects a positive reassessment of the company’s profitability projections, informed by a detailed pro forma analysis and an adjusted target multiple now calculated at 12.5 times, an elevation from the previous 11 times.
Canaccord Genuity’s ongoing ‘Hold’ rating signals a prudent perspective as Worthington Industries strides ahead following its structural reorganization from the steel segment, inviting a careful watch on its ensuing performance dynamics
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