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

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In the latest trading session, Steel Dynamics (STLD - Free Report) closed at $61.25, marking a -1.51% move from the previous day. This change lagged the S&P 500's daily gain of 0.31%. Meanwhile, the Dow gained 0.1%, and the Nasdaq, a tech-heavy index, added 0.48%.

Heading into today, shares of the steel producer and metals recycler had lost 5.39% over the past month, lagging the Basic Materials sector's gain of 0.09% and the S&P 500's loss of 0.04% in that time.

Wall Street will be looking for positivity from Steel Dynamics as it approaches its next earnings report date. On that day, Steel Dynamics is projected to report earnings of $5.88 per share, which would represent year-over-year growth of 506.19%. Our most recent consensus estimate is calling for quarterly revenue of $5.35 billion, up 105.67% from the year-ago period.

STLD's full-year Zacks Consensus Estimates are calling for earnings of $16.40 per share and revenue of $18.42 billion. These results would represent year-over-year changes of +477.46% and +91.88%, respectively.

It is also important to note the recent changes to analyst estimates for Steel Dynamics. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Steel Dynamics is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that Steel Dynamics has a Forward P/E ratio of 3.79 right now. For comparison, its industry has an average Forward P/E of 3.71, which means Steel Dynamics is trading at a premium to the group.

The Steel - Producers industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 29, which puts it in the top 12% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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 Zacks.com.


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