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Steel Dynamics (STLD) Gains But Lags Market: What You Should Know

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In the latest trading session, Steel Dynamics (STLD - Free Report) closed at $61.20, marking a +0.05% move from the previous day. This move lagged the S&P 500's daily gain of 0.12%.

Prior to today's trading, shares of the steel producer and metals recycler had lost 3.18% over the past month. This has lagged the Basic Materials sector's loss of 1.88% and the S&P 500's gain of 3% in that time.

STLD will be looking to display strength as it nears its next earnings release, which is expected to be July 19, 2021. On that day, STLD is projected to report earnings of $3.42 per share, which would represent year-over-year growth of 627.66%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.17 billion, up 98.93% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $14.34 per share and revenue of $16.36 billion, which would represent changes of +404.93% and +70.43%, respectively, from the prior year.

Any recent changes to analyst estimates for STLD should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. The Zacks Consensus EPS estimate has moved 50.79% higher within the past month. STLD is holding a Zacks Rank of #1 (Strong Buy) right now.

Digging into valuation, STLD currently has a Forward P/E ratio of 4.27. Its industry sports an average Forward P/E of 6.06, so we one might conclude that STLD is trading at a discount comparatively.

Also, we should mention that STLD has a PEG ratio of 0.36. 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. The Steel - Producers was holding an average PEG ratio of 0.28 at yesterday's closing price.

The Steel - Producers industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 13, which puts it in the top 6% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on

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