Nucor Corporation NUE recently announced that it is acquiring TrueCore, LLC. Notably, TrueCore is an insulated metal panel manufacturing company with its facility in Laurens, SC. It caters to the cold storage market and plans for additional industrial as well as commercial applications in the future.
Per Nucor’s management, the acquisition is expected to strengthen its value-added product portfolio and deliver significant synergies. Also, founding partners of TrueCore are expected to remain with the company and bring considerable industry experience as well as commitment to the insulated panel market.
Currently, TrueCore has 26 employees that will become part of Nucor Buildings Group. It plans to add additional products such as a line of fire-rated panels and insulated roof panels to its portfolio. Further, it plans to start construction on new facilities in the upcoming months to serve the Western and Midwestern markets.
Shares of Nucor have gained 3% in the past year against the industry’s 4.9% decline.
Nucor expects earnings per share (EPS) in the range of 25-30 cents for the fourth quarter of 2019. This suggests a sequential decline from EPS of 90 cents in the third quarter and a fall from $2.07 recorded in the year-ago quarter.
The company expects steel mills unit’s performance to sequentially decline in the fourth quarter due to lower steel prices.
The steel products unit’s profitability is forecast to decline sequentially in the fourth quarter due to normal seasonality. However, the company expects profitability of the steel products unit to be significantly higher on a year-over-year basis.
The company sees raw materials unit’s losses to sequentially widen in the fourth quarter, stemming from the planned outage at its Louisiana DRI facility and further margin compression throughout the raw materials business.
Nucor Corporation Price and Consensus
Nucor currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are General Moly, Inc , Franco-Nevada Corporation FNV and Sandstorm Gold Ltd SAND, each currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
General Moly has an expected earnings growth rate of 12.5% for the current fiscal year. The company’s shares have gained 50.3% in the past year.
Franco-Nevada has a projected earnings growth rate of 48.7% for 2019. The company’s shares have rallied 36.9% in a year.
Sandstorm Gold has an estimated earnings growth rate of 166.7% for the current year. Its shares have moved up 52.8% in the past year.
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