U.S. Markets open in 3 hrs 30 mins
  • Gold

    1,804.60
    -2.20 (-0.12%)
     
  • EUR/USD

    1.1620
    +0.0005 (+0.0465%)
     
  • 10-Yr Bond

    1.6350
    0.0000 (0.00%)
     
  • Vix

    14.97
    -0.46 (-2.98%)
     
  • GBP/USD

    1.3793
    +0.0024 (+0.1752%)
     
  • USD/JPY

    114.0100
    +0.3110 (+0.2735%)
     
  • BTC-USD

    62,695.42
    -58.38 (-0.09%)
     
  • CMC Crypto 200

    1,507.23
    +1,264.55 (+521.08%)
     
  • FTSE 100

    7,265.26
    +42.44 (+0.59%)
     
  • Nikkei 225

    29,106.01
    +505.60 (+1.77%)
     

Do Insiders Own Lots Of Shares In Worthington Industries, Inc. (NYSE:WOR)?

  • Oops!
    Something went wrong.
    Please try again later.
·4 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

Every investor in Worthington Industries, Inc. (NYSE:WOR) should be aware of the most powerful shareholder groups. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

Worthington Industries is a pretty big company. It has a market capitalization of US$3.2b. Normally institutions would own a significant portion of a company this size. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Worthington Industries.

View our latest analysis for Worthington Industries

ownership-breakdown
ownership-breakdown

What Does The Institutional Ownership Tell Us About Worthington Industries?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Worthington Industries. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Worthington Industries, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
earnings-and-revenue-growth

Hedge funds don't have many shares in Worthington Industries. From our data, we infer that the largest shareholder is John McConnell (who also holds the title of Top Key Executive) with 32% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. In comparison, the second and third largest shareholders hold about 9.5% and 7.1% of the stock. Additionally, the company's CEO B. Rose directly holds 1.3% of the total shares outstanding.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Worthington Industries

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own a reasonable proportion of Worthington Industries, Inc.. Insiders own US$1.2b worth of shares in the US$3.2b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 15% ownership, the general public have some degree of sway over Worthington Industries. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Worthington Industries is showing 4 warning signs in our investment analysis , and 2 of those are a bit concerning...

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.