Why the Worley (ASX:WOR) share price finished the day lower today

The engineering company’s shares have plummeted to 2021 lows…
The post Why the Worley (ASX:WOR) share price finished the day lower today appeared first on The Motley Fool Australia. –

The Worley Ltd (ASX: WOR) share price continued its negative run today, falling lower throughout the day.

At the end of Thursday’s market session, Worley shares finished down 2.3% to a year-to-date low of $9.79.

It was also the most heavily traded stock on the ASX 200 today, with more than 59 million Worley shares swapping hands.

What did Worley announce today?

Investors offloaded their holdings in Worley shares after the company provided the ASX with a disappointing update.

According to the release, Worley advised it received a note from Jacobs Engineering Group Inc last night after market close.

Jacobs notified Worley that it had entered into a block trade agreement with Citigroup Global Markets Australia to sell all of its shares in Worley. This translates to roughly a 9.85% stake in the company.

Jacobs became a Worley shareholder following Worley’s acquisition of the Jacobs Energy, Chemicals and Resources division in October 2018. However, Jacobs was released from the lock-up of Worley shares in late December 2019, removing any share-trading restrictions.

Worley’s CEO Chris Ashton aimed at appeasing existing investors, saying: “We welcome the shareholders who will join our register.”

Are Worley shares a buy?

A number of brokers weighed in on the Worley share price following the release of its full-year results last month.

Morgan Stanley cut its rating on Worley shares by 2.7% to $11.00 per share. Citi also followed suit, reducing its price target by 4% to $12.28.

The last broker note came from Credit Suisse, which raised its outlook by 4% to $10.40.

About the Worley share price

A leading global engineering company, Worley provides design and project delivery services, including maintenance, reliability support services, and advisory services. The business operates in the energy, chemical, and resources sectors.

Over the past 12 months, Worley shares have been on a rollercoaster ride, recording gains of just 3%. In 2021, the Worley share price has fallen almost 15%, brought on by uncertainty in the economy due to COVID-19.

Based on today’s price, Worley commands a market capitalisation of roughly $5.1 billion, with approximately 522 million shares on issue.

It’s worth noting the company’s shares can be considered expensive, with a price-to-earnings (P/E) ratio of 59.33.

The post Why the Worley (ASX:WOR) share price finished the day lower today appeared first on The Motley Fool Australia.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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