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Nucor's (NUE) Q2 Earnings Surpass Estimates, Revenues Lag
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Nucor Corporation (NUE - Free Report) reported earnings of $5.81 per share for second-quarter 2023, down from earnings of $9.67 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $5.59.
The company recorded net sales of $9,523.3 million, down around 19% year over year. The figure missed the Zacks Consensus Estimate of $9,733.8 million.
The company benefited from higher realized prices. It also benefited from high margins for steel mills units and increased profitability for its DRI facilities in the reported quarter.
Nucor Corporation Price, Consensus and EPS Surprise
Total sales tons to outside customers for steel mills in the second quarter were 4,774,000 tons, a 5% decrease year over year. It fell short of our estimate of 4,925,000 tons.
Average sales price for steel mills was $1,168 per ton, which fell 18% year over year but was up around 13% sequentially. It also beat our estimate of $1,088 per ton.
Overall operating rates at the company's steel mills increased to 84% in the second quarter of 2023 compared with 79% in the first quarter of 2023 and decreased from 85% in the second quarter of 2022.
Segment Highlights
Earnings of the company’s steel mills unit rose 67.5% on a sequential basis in the reported quarter on higher margins.
Earnings in the steel products division were higher by 4.1% sequentially in the second quarter due to higher volumes.
The raw materials segment’s earnings were up 138% sequentially on higher profitability from the company’s direct reduced iron (“DRI”) facilities.
Financial Position
Cash and cash equivalents were $4,510.6 million at the end of the quarter, up 125% year over year. Long-term debt was $6,620.7 million, flat year over year.
The company repurchased roughly 3.1 million shares of its common stock at an average price of $147.03 per share during the quarter.
Outlook
For the third quarter of 2023, the company foresees a sequential decrease in earnings. This projected decline is primarily due to reduced profitability from the steel mills segment, with the most significant impact at the sheet mills.
Additionally, the steel products segment is also expected to experience a moderation in earnings during the third quarter of 2023 on a sequential basis.
Moreover, the raw materials segment is projected to witness a decrease in earnings for the third quarter of 2023 in comparison to the second quarter. This can be attributed to margin compression at the company's DRI facilities and scrap processing operations.
Price Performance
Shares of Nucor have gained 35.1% in a year compared with the industry’s 53% rise.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
Nucor currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the Basic Materials space include Livent Corporation and Carpenter Technology Corporation (CRS - Free Report) , both sporting a Zacks Rank #1 (Strong Buy), and United States Steel Corporation (X - Free Report) , carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LTHM’s current-year earnings has been revised 14% upward in the past 90 days. LTHM beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 22%. The company’s shares have gained 8.3% in the past year.
The earnings estimate for CRS’s current year is pegged at $1.04, indicating year-over-year growth of 198%. CRS beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 30.9%. The company’s shares have rallied 95.4% in the past year.
The Zacks Consensus Estimate for X’s current-year earnings has been revised 5.4% upward in the past 60 days. U. S. Steel beat the Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 18.1% on average. The company’s shares have risen roughly 21.7% in the past year.
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Nucor's (NUE) Q2 Earnings Surpass Estimates, Revenues Lag
Nucor Corporation (NUE - Free Report) reported earnings of $5.81 per share for second-quarter 2023, down from earnings of $9.67 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $5.59.
The company recorded net sales of $9,523.3 million, down around 19% year over year. The figure missed the Zacks Consensus Estimate of $9,733.8 million.
The company benefited from higher realized prices. It also benefited from high margins for steel mills units and increased profitability for its DRI facilities in the reported quarter.
Nucor Corporation Price, Consensus and EPS Surprise
Nucor Corporation price-consensus-eps-surprise-chart | Nucor Corporation Quote
Operating Figures
Total sales tons to outside customers for steel mills in the second quarter were 4,774,000 tons, a 5% decrease year over year. It fell short of our estimate of 4,925,000 tons.
Average sales price for steel mills was $1,168 per ton, which fell 18% year over year but was up around 13% sequentially. It also beat our estimate of $1,088 per ton.
Overall operating rates at the company's steel mills increased to 84% in the second quarter of 2023 compared with 79% in the first quarter of 2023 and decreased from 85% in the second quarter of 2022.
Segment Highlights
Earnings of the company’s steel mills unit rose 67.5% on a sequential basis in the reported quarter on higher margins.
Earnings in the steel products division were higher by 4.1% sequentially in the second quarter due to higher volumes.
The raw materials segment’s earnings were up 138% sequentially on higher profitability from the company’s direct reduced iron (“DRI”) facilities.
Financial Position
Cash and cash equivalents were $4,510.6 million at the end of the quarter, up 125% year over year. Long-term debt was $6,620.7 million, flat year over year.
The company repurchased roughly 3.1 million shares of its common stock at an average price of $147.03 per share during the quarter.
Outlook
For the third quarter of 2023, the company foresees a sequential decrease in earnings. This projected decline is primarily due to reduced profitability from the steel mills segment, with the most significant impact at the sheet mills.
Additionally, the steel products segment is also expected to experience a moderation in earnings during the third quarter of 2023 on a sequential basis.
Moreover, the raw materials segment is projected to witness a decrease in earnings for the third quarter of 2023 in comparison to the second quarter. This can be attributed to margin compression at the company's DRI facilities and scrap processing operations.
Price Performance
Shares of Nucor have gained 35.1% in a year compared with the industry’s 53% rise.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
Nucor currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the Basic Materials space include Livent Corporation and Carpenter Technology Corporation (CRS - Free Report) , both sporting a Zacks Rank #1 (Strong Buy), and United States Steel Corporation (X - Free Report) , carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for LTHM’s current-year earnings has been revised 14% upward in the past 90 days. LTHM beat the Zacks Consensus Estimate in each of the last four quarters, with the average earnings surprise being 22%. The company’s shares have gained 8.3% in the past year.
The earnings estimate for CRS’s current year is pegged at $1.04, indicating year-over-year growth of 198%. CRS beat the Zacks Consensus Estimate in all the last four quarters, with the average earnings surprise being 30.9%. The company’s shares have rallied 95.4% in the past year.
The Zacks Consensus Estimate for X’s current-year earnings has been revised 5.4% upward in the past 60 days. U. S. Steel beat the Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 18.1% on average. The company’s shares have risen roughly 21.7% in the past year.