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The U.S. steel giant surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missed once. It has a trailing four-quarter earnings surprise of 3.1%, on average. It posted an earnings surprise of around 8.5% in the last reported quarter. The company is likely to have benefited in the third quarter from continued strength in the non-residential construction markets. However, weaker prices are likely to have hurt its results.
Nucor’s shares are up 19% over a year, compared with the industry’s 20.6% decline.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
Nucor, last month, issued its earnings guidance for the third quarter. It anticipates third-quarter earnings to be between $6.30 and $6.40 per share.
The Zacks Consensus Estimate for third-quarter consolidated revenues for Nucor is currently pegged at $10,059.3 million, reflecting a year-over-year decline of 2.5%.
The Zacks Consensus Estimate for third-quarter average sales price per ton for the company’s steel mills unit stands at $1,248, suggesting a 6.8% year-over-year decline and a 12.7% sequential decrease.
A Few Factors to Watch
The company’s third-quarter results are likely to reflect weaker steel prices. However, its steel products segment is expected to have benefited from continued strong demand in non-residential construction markets.
Nucor, in September, said that it expects earnings to decline significantly in the steel mills segment on a sequential comparison basis in the third quarter. The expected decline is due to metal margin contraction and lower shipment volumes, especially at its sheet and plate mills.
The company also expects its steel products segment to deliver another strong quarter, with earnings roughly in-line with second-quarter 2022. Earnings for the raw materials unit are forecast to be flat on a sequential comparison basis in the third quarter.
U.S. steel prices have witnessed a significant downward correction. After surging to nearly $1,500 per short ton in April 2022 due to supply concerns stemming from the Russia-Ukraine war, the benchmark hot-rolled coil ("HRC") prices have retreated and fallen below the $800 per short ton level. The downward drift partly reflects shorter lead times. Mills are also negotiating lower prices for new orders. Fears of a recession have also impacted prices.
Lower selling prices are likely to have weighed on Nucor’s steel mills segment in the to-be-reported quarter.
Our proven model does not conclusively predict an earnings beat for Nucor this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Nucor is 0.00%. The Zacks Consensus Estimate for earnings for the third quarter is currently pegged at $6.45. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Nucor currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
The consensus estimate for Albemarle’s third-quarter earnings has been revised 9% upward in the past 60 days. The Zacks Consensus Estimate for ALB’s earnings for the quarter is pegged at $6.81.
Koppers Holdings Inc. (KOP - Free Report) , expected to release earnings on Nov 3, has an Earnings ESP of +2.28% and carries a Zacks Rank #2.
The Zacks Consensus Estimate for Koppers’ third-quarter earnings has been revised 2.6% upward in the past 60 days. The consensus estimate for KOP’s earnings for the quarter is currently pegged at $1.17.
FMC Corporation (FMC - Free Report) , scheduled to release earnings on Nov 1, has an Earnings ESP of +0.30%.
The Zacks Consensus Estimate for FMC's earnings for the third quarter is currently pegged at $1.11. FMC currently carries a Zacks Rank #3.
Image: Bigstock
Nucor (NUE) Gears Up for Q3 Earnings: What's in the Offing?
Nucor Corporation (NUE - Free Report) is set to release third-quarter 2022 results ahead of the bell on Oct 20.
The U.S. steel giant surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missed once. It has a trailing four-quarter earnings surprise of 3.1%, on average. It posted an earnings surprise of around 8.5% in the last reported quarter. The company is likely to have benefited in the third quarter from continued strength in the non-residential construction markets. However, weaker prices are likely to have hurt its results.
Nucor’s shares are up 19% over a year, compared with the industry’s 20.6% decline.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
Nucor, last month, issued its earnings guidance for the third quarter. It anticipates third-quarter earnings to be between $6.30 and $6.40 per share.
The Zacks Consensus Estimate for third-quarter consolidated revenues for Nucor is currently pegged at $10,059.3 million, reflecting a year-over-year decline of 2.5%.
The Zacks Consensus Estimate for third-quarter average sales price per ton for the company’s steel mills unit stands at $1,248, suggesting a 6.8% year-over-year decline and a 12.7% sequential decrease.
A Few Factors to Watch
The company’s third-quarter results are likely to reflect weaker steel prices. However, its steel products segment is expected to have benefited from continued strong demand in non-residential construction markets.
Nucor, in September, said that it expects earnings to decline significantly in the steel mills segment on a sequential comparison basis in the third quarter. The expected decline is due to metal margin contraction and lower shipment volumes, especially at its sheet and plate mills.
The company also expects its steel products segment to deliver another strong quarter, with earnings roughly in-line with second-quarter 2022. Earnings for the raw materials unit are forecast to be flat on a sequential comparison basis in the third quarter.
U.S. steel prices have witnessed a significant downward correction. After surging to nearly $1,500 per short ton in April 2022 due to supply concerns stemming from the Russia-Ukraine war, the benchmark hot-rolled coil ("HRC") prices have retreated and fallen below the $800 per short ton level. The downward drift partly reflects shorter lead times. Mills are also negotiating lower prices for new orders. Fears of a recession have also impacted prices.
Lower selling prices are likely to have weighed on Nucor’s steel mills segment in the to-be-reported quarter.
Nucor Corporation Price and EPS Surprise
Nucor Corporation price-eps-surprise | Nucor Corporation Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Nucor this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Nucor is 0.00%. The Zacks Consensus Estimate for earnings for the third quarter is currently pegged at $6.45. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Nucor currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:
Albemarle Corporation (ALB - Free Report) , scheduled to release earnings on Nov 2, has an Earnings ESP of +8.13% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for Albemarle’s third-quarter earnings has been revised 9% upward in the past 60 days. The Zacks Consensus Estimate for ALB’s earnings for the quarter is pegged at $6.81.
Koppers Holdings Inc. (KOP - Free Report) , expected to release earnings on Nov 3, has an Earnings ESP of +2.28% and carries a Zacks Rank #2.
The Zacks Consensus Estimate for Koppers’ third-quarter earnings has been revised 2.6% upward in the past 60 days. The consensus estimate for KOP’s earnings for the quarter is currently pegged at $1.17.
FMC Corporation (FMC - Free Report) , scheduled to release earnings on Nov 1, has an Earnings ESP of +0.30%.
The Zacks Consensus Estimate for FMC's earnings for the third quarter is currently pegged at $1.11. FMC currently carries a Zacks Rank #3.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.