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Nucor (NUE) Tops Q1 Earnings & Revenue Estimates, View Solid

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Nucor Corporation (NUE - Free Report) saw lower profits (on a reported basis) year over year in first-quarter 2018. The steel giant logged net earnings of $354.2 million or $1.10 per share compared with $356.9 million or $1.11 per share registered a year ago.

Barring one-time items, earnings per share for the reported quarter came in at $1.17, which surpassed the Zacks Consensus Estimate of $1.10.

Nucor reported revenues of $5,568.4 million, up roughly 15.6% year over year from $4,815.2 million. The figure surpassed the Zacks Consensus Estimate of $5,541.6 million.

Nucor Corporation Price, Consensus and EPS Surprise

Nucor Corporation Price, Consensus and EPS Surprise | Nucor Corporation Quote

Operating Stats

Total steel mills shipments in the first quarter were 6,268,000 tons, up 7% year over year. Total tons shipped to outside customers were up 6% to 6,967,000 tons. Average sales price in the quarter was up 9%.

Steel mill operating rates increased to 92% in the first quarter from 88% a year ago.

Segment Highlights

Nucor’s profitability in the steel mills segment in the first quarter of 2018 improved on sequential basis on the back of increased volumes and higher selling prices for all of its steel mill products. However, profitability of the steel products segment decreased sequentially due to seasonality.

Performance of the raw materials unit also improved sequentially on the back of improved performance of the company’s scrap processing operations along with its direct reduced iron facilities.

Financial Position

Nucor ended the first quarter with cash and cash equivalents of around $760.3 million, down 54.1% year over year. Long-term debt was $3,242.9 million, down roughly 13.3%.


Nucor expects its earnings in the second quarter of 2018 to increase considerably from the first. Notably, the steel mill metal profitability and margins in March were the strongest by far in the first quarter. The company expects steel mills segment’s performance to improve sequentially in the second quarter as it continues to see the benefits of price increases.

Nucor believe that there is sustainable strength in steel end-use markets and is also encouraged by recent actions taken by the U.S. government to address the issue of illegally subsidized imports into the country.

The company expects performance for its steel products unit to sequentially improve in the second quarter, as increasing steel input costs are being passed on to customers.

Price Performance

Shares of Nucor have lost 4.8% in the last three months, outperforming the industry’s 7.9% decline.

Zacks Rank & Other Stocks to Consider

Nucor currently carries a Zacks Rank #2 (Buy).

Some other stocks worth considering in the basic materials space are Steel Dynamics, Inc. (STLD - Free Report) , United States Steel Corp. (X - Free Report) and CF Industries Holdings, Inc. (CF - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Steel Dynamics has an expected long-term earnings growth rate of 12%. Its shares have gained 35.5% over a year.

U.S. Steel has an expected long-term earnings growth rate of 8%. Its shares have soared 22.9% over the past six months.

CF Industries has an expected long-term earnings growth rate of 6%. Its shares have rallied 50.6% over a year.

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