Headquartered in Charlotte, North Carolina, Nucor (NUE)is a leading producer of structural steel, steel bars, steel joists, steel deck and cold finished bars. The company has approximately 200 operating facilities. They are also the largest recycler in the United States.
The company has grown organically as well as through strategic acquisitions over the years. They currently operate in three segments – the Steel Mills segment (78% of total tons sold in 2016), the Steel Products segment (22%) and the Raw Materials segment.
Solid Quarterly Results and Upgraded Guidance
The company swung to profit in Q4, thanks to increased shipments and higher steel prices. During the quarter, earnings were $0.50 per share compared with a loss of $0.59 per share in the same quarter a year ago. Earnings were significantly ahead of the Zacks Consensus Estimate of $0.34 per share.
Sales increased approximately 14% year over year and also beat the Zacks Consensus Estimate.
The steel producer expects Q1 as well as FY 2017 earnings to improve significantly from their 2016 levels.
Returning Cash to Shareholders
The company continues to boost shareholder value through dividends and share buybacks. They have increased their base dividend for 44 consecutive years, irrespective of the commodity cycle. They retuned $4.0 Billion to shareholders during 2004-2008 up-cycle and another $3.8 billion during 2009-2016 down-cycle.
Surging Estimates
Analysts have significantly raised their estimates for the company after strong earnings and upgraded guidance. Zacks Consensus Estimates for the current and next year are now $4.23 per share and $4.44 per share, up from $3.71 and $4.61, before the results.
Time to Buy after Recent Weakness?
We have seen a reversal of the Trump trade over the past few weeks, thanks to investors’ worries whether the President will be able to implement his economic agenda anytime soon.
While there is uncertainty regarding Trump’s agenda, global growth has been picking up of late. China has stabilized and its manufacturing has been gaining momentum. This scenario should help steel makers all over the world.
Further, President Trump is expected to take action to prevent dumping of steel by China, which will benefit US steel producers. And, unlike healthcare, there is a greater possibility of a bilateral agreement on infrastructure spending, even though the timing remains uncertain as of now.
Bottom-Line
The steel industry is currently ranked #20 out of 265 Zacks Industries (Top 8%), suggesting near-to-mid term outperformance. Additionally with a dividend yield of 2.53%, expected EPS growth rate of 12% (3-5 years) and a top Zacks Rank, this stock is worth a look.
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Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
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From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Headquartered in Charlotte, North Carolina, Nucor (NUE)is a leading producer of structural steel, steel bars, steel joists, steel deck and cold finished bars. The company has approximately 200 operating facilities. They are also the largest recycler in the United States.
The company has grown organically as well as through strategic acquisitions over the years. They currently operate in three segments – the Steel Mills segment (78% of total tons sold in 2016), the Steel Products segment (22%) and the Raw Materials segment.
Solid Quarterly Results and Upgraded Guidance
The company swung to profit in Q4, thanks to increased shipments and higher steel prices. During the quarter, earnings were $0.50 per share compared with a loss of $0.59 per share in the same quarter a year ago. Earnings were significantly ahead of the Zacks Consensus Estimate of $0.34 per share.
Sales increased approximately 14% year over year and also beat the Zacks Consensus Estimate.
The steel producer expects Q1 as well as FY 2017 earnings to improve significantly from their 2016 levels.
Returning Cash to Shareholders
The company continues to boost shareholder value through dividends and share buybacks. They have increased their base dividend for 44 consecutive years, irrespective of the commodity cycle. They retuned $4.0 Billion to shareholders during 2004-2008 up-cycle and another $3.8 billion during 2009-2016 down-cycle.
Surging Estimates
Analysts have significantly raised their estimates for the company after strong earnings and upgraded guidance. Zacks Consensus Estimates for the current and next year are now $4.23 per share and $4.44 per share, up from $3.71 and $4.61, before the results.
Time to Buy after Recent Weakness?
We have seen a reversal of the Trump trade over the past few weeks, thanks to investors’ worries whether the President will be able to implement his economic agenda anytime soon.
While there is uncertainty regarding Trump’s agenda, global growth has been picking up of late. China has stabilized and its manufacturing has been gaining momentum. This scenario should help steel makers all over the world.
Further, President Trump is expected to take action to prevent dumping of steel by China, which will benefit US steel producers. And, unlike healthcare, there is a greater possibility of a bilateral agreement on infrastructure spending, even though the timing remains uncertain as of now.
Bottom-Line
The steel industry is currently ranked #20 out of 265 Zacks Industries (Top 8%), suggesting near-to-mid term outperformance. Additionally with a dividend yield of 2.53%, expected EPS growth rate of 12% (3-5 years) and a top Zacks Rank, this stock is worth a look.
More Stock News: 8 Companies Verge on Apple-Like Run
Did you miss Apple's 9X stock explosion after they launched their iPhone in 2007? Now 2017 looks to be a pivotal year to get in on another emerging technology expected to rock the market. Demand could soar from almost nothing to $42 billion by 2025. Reports suggest it could save 10 million lives per decade which could in turn save $200 billion in U.S. healthcare costs.
A bonus Zacks Special Report names this breakthrough and the 8 best stocks to exploit it. Like Apple in 2007, these companies are already strong and coiling for potential mega-gains. Click to see them right now >>
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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