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Nucor to Invest $85M for Upgrading Rolling Mill at Ohio
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Nucor Corporation (NUE - Free Report) has announced plans to upgrade a rolling mill at Nucor Steel Marion, Inc. by investing $85 million. Notably, Nucor Steel Marion, located in Marion, OH is the state's largest producer of rebar and signpost. The mill is capable of producing more than 400,000 tons annually.
With the upgrade, Nucor Steel Marion will be able to maintain a cost competitive position by reducing operating costs. This would enable it to serve the customers better. Further, it will enhance Nucor Steel Marion’s ability to produce the most efficient and highest-quality recycled steel available in the market. Also, the modernization will create a substantial number of jobs at the mill.
Nucor has underperformed the Zacks categorized Steel-Producers industry over the past three months. While the company's shares rose 1%, the industry witnessed a gain of 5.2% over the same time frame.
Nucor remains committed to expand its production capabilities and grow its business through strategic acquisitions. Notably, the acquisition of Gallatin Steel has strengthened the company’s foothold in the Midwest market and has provided ample opportunities to boost shareholder value. The buyout of Joy Global's steel plate mill will also enable Nucor to capture a growing share of higher value-added plate products.
Moreover, the buyout of Chicago-based Independence Tube Corporation has allowed Nucor to offer a broader selection of products to its fabricator and service center customers and reinforced the company's foothold in key non-residential construction end-use market.
Nucor, earlier this year, also closed its purchase of steel electrical conduit maker, Republic Conduit, from Luxembourg-based Tenaris S.A. for $335 million. The acquisition makes Nucor the market leader in steel conduits. Moreover, the company acquired Southland Tube for $130 million in Jan 2017. The buyout strengthens Nucor’s foothold in the hollow structural section (“HSS”) steel tubing market.
Demand in the automotive market also remains healthy and is expected to improve, in turn, providing more strength to the company’s top line. Nucor remains focused on achieving greater penetration of this major market. Nucor has entered into a joint venture with JFE Steel Corporation of Japan to build and operate a plant in Mexico that will supply sheet steel to the country’s growing automotive market.
However, the company is exposed to certain macroeconomic difficulties including continued weakness in the steel industry and persistent risk of cheaper imports.
Ternium has an expected long-term growth of 18.4%.
U.S. Steel has an expected long-term growth of 8%.
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Nucor to Invest $85M for Upgrading Rolling Mill at Ohio
Nucor Corporation (NUE - Free Report) has announced plans to upgrade a rolling mill at Nucor Steel Marion, Inc. by investing $85 million. Notably, Nucor Steel Marion, located in Marion, OH is the state's largest producer of rebar and signpost. The mill is capable of producing more than 400,000 tons annually.
With the upgrade, Nucor Steel Marion will be able to maintain a cost competitive position by reducing operating costs. This would enable it to serve the customers better. Further, it will enhance Nucor Steel Marion’s ability to produce the most efficient and highest-quality recycled steel available in the market. Also, the modernization will create a substantial number of jobs at the mill.
Nucor has underperformed the Zacks categorized Steel-Producers industry over the past three months. While the company's shares rose 1%, the industry witnessed a gain of 5.2% over the same time frame.
Nucor remains committed to expand its production capabilities and grow its business through strategic acquisitions. Notably, the acquisition of Gallatin Steel has strengthened the company’s foothold in the Midwest market and has provided ample opportunities to boost shareholder value. The buyout of Joy Global's steel plate mill will also enable Nucor to capture a growing share of higher value-added plate products.
Moreover, the buyout of Chicago-based Independence Tube Corporation has allowed Nucor to offer a broader selection of products to its fabricator and service center customers and reinforced the company's foothold in key non-residential construction end-use market.
Nucor, earlier this year, also closed its purchase of steel electrical conduit maker, Republic Conduit, from Luxembourg-based Tenaris S.A. for $335 million. The acquisition makes Nucor the market leader in steel conduits. Moreover, the company acquired Southland Tube for $130 million in Jan 2017. The buyout strengthens Nucor’s foothold in the hollow structural section (“HSS”) steel tubing market.
Demand in the automotive market also remains healthy and is expected to improve, in turn, providing more strength to the company’s top line. Nucor remains focused on achieving greater penetration of this major market. Nucor has entered into a joint venture with JFE Steel Corporation of Japan to build and operate a plant in Mexico that will supply sheet steel to the country’s growing automotive market.
However, the company is exposed to certain macroeconomic difficulties including continued weakness in the steel industry and persistent risk of cheaper imports.
Nucor Corporation Price and Consensus
Nucor Corporation Price and Consensus | Nucor Corporation Quote
Nucor currently carries a Zacks Rank #3 (Hold).
Stocks to consider
Better-ranked companies in the steel space include POSCO (PKX - Free Report) , Ternium S.A. (TX - Free Report) and United States Steel Corporation (X - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
POSCO has an expected long-term growth of 5%.
Ternium has an expected long-term growth of 18.4%.
U.S. Steel has an expected long-term growth of 8%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020. Click here for the 6 trades >>