Back to top

Image: Bigstock

Steel Dynamics (STLD) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

Steel Dynamics (STLD - Free Report) closed the most recent trading day at $63.75, moving -1.16% from the previous trading session. This change lagged the S&P 500's daily gain of 0.15%.

Coming into today, shares of the steel producer and metals recycler had gained 8.57% in the past month. In that same time, the Basic Materials sector gained 8.81%, while the S&P 500 gained 0.58%.

STLD will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.61, up 455.32% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.1 billion, up 95.87% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $8.41 per share and revenue of $14.51 billion, which would represent changes of +196.13% and +51.11%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for STLD. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 3.27% higher. STLD currently has a Zacks Rank of #1 (Strong Buy).

Investors should also note STLD's current valuation metrics, including its Forward P/E ratio of 7.67. For comparison, its industry has an average Forward P/E of 7.51, which means STLD is trading at a premium to the group.

Investors should also note that STLD has a PEG ratio of 0.64 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Steel - Producers stocks are, on average, holding a PEG ratio of 0.55 based on yesterday's closing prices.

The Steel - Producers industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 18, which puts it in the top 8% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


In-Depth Zacks Research for the Tickers Above


Normally $25 each - click below to receive one report FREE:


Steel Dynamics, Inc. (STLD) - free report >>

Published in