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Nucor (NUE) Sees Higher Q1 Profits From Steel Mills Unit

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Nucor Corporation (NUE - Free Report) has announced its earnings guidance for the first quarter of 2023 in the range of $3.70-$3.80 per share. The company’s fourth-quarter 2022 earnings were $4.89 per share. Earnings in the prior-year quarter were $7.67 per share.

Nucor expects profitability from its steel mills to be up sequentially on the back of higher margins and volumes, mainly resulting from an improvement in operations at its sheet mills. Earnings from the company’s steel products segments are expected to be strong but lower than the fourth quarter due to lower realized pricing and weak construction activity. However, profits are expected to be higher year over year.

Higher volumes at DRI facilities, scrap recycling and brokerage operations are expected to drive profitability in the raw materials segment. The company expects profits to be up sequentially for this segment.

Nucor expects operating income from all its business segments to be stronger than the fourth quarter. However, consolidated earnings from its operations are expected to be lower sequentially due to less favorable intercompany eliminations resulting from sales activity between segments and changes in the value of intercompany inventory at the end of each quarter. The absence of state tax benefits is also expected to contribute to lower earnings in the first quarter.

Nucor also bought back 2 million of its common stock during the first quarter at an average price of $158.57 per share. It has also returned approximately $450 million to shareholders through share repurchases and dividends year to date.

Shares of Nucor have gained 6.8% in the past year against a 3.6% decline of the industry.

Zacks Investment Research

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Zacks Rank & Other Key Picks

Nucor currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the basic materials space are ATI Inc. (ATI - Free Report) , Olympic Steel, Inc.  (ZEUS - Free Report) and Cal-Maine Foods, Inc. (CALM - Free Report) . ATI currently carries a Zacks Rank #2 (Buy), while ZEUS and CALM sport a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.  

ATI’s shares have gained 44.1% in the past year. The Zacks Consensus Estimate for ATI’s current-year earnings has been revised 1.4% upward in the past 60 days. The company has an earnings growth rate of 9% for the current year.

ATI topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 32.4% on average.

Olympic Steel’s shares have gained 38% in the past year. The Zacks Consensus Estimate for its current-year earnings has been revised 61% upward in the past 60 days. ZEUS topped Zacks Consensus Estimate in all the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.2% on average.

Cal-Maine’s shares have gained 6% in the past year. The company has an earnings growth rate of 515.8% for the current year. The Zacks Consensus Estimate for CALM’s current-year earnings has been revised 19% upward in the past 60 days.

CALM topped Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 15.3% on average.




 
 


 

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