Nucor Corporation NUE is set to release fourth-quarter 2024 results after the closing bell on Jan. 27.
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The U.S. steel giant surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missing once. NUE has a trailing four-quarter earnings surprise of 7.4%, on average. It posted an earnings surprise of 6.4% in the last reported quarter. Lower earnings in the steel mills segment on weaker selling prices are likely to have hurt NUE’s fourth-quarter results.
Nucor’s shares have lost 30.1% over a year, compared with the Zacks Steel Producers industry’s 24.5% decline.
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Let’s see how things are shaping up for this announcement.
What Our Model Unveils for NUE Stock
Our proven model predicts an earnings beat for Nucor this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earning beat.
Earnings ESP: Earnings ESP for NUE is +2.40%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at 64 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: NUE currently carries a Zacks Rank #3.
What do NUE’s Earnings Estimates Say?
Nucor anticipates fourth-quarter earnings in the range of 55-65 cents per share. This reflects a decline from $1.05 per share reported in the prior quarter and $3.16 per share in fourth-quarter 2023.
The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Nucor is currently pegged at $6,598 million, reflecting a year-over-year decline of 14.4%.
Factors at Play for NUE Stock
Lower profitability in the steel mills segment is expected to have weighed on Nucor’s performance in the quarter to be reported. NUE, last month, said that it expects a decline in earnings, hurt by the steel mills segment’s lower earnings due to lower volumes and average selling prices. The company also expects profitability in the steel products segment to fall in the fourth quarter from the third quarter of 2024, owing to reduced volumes and average selling prices.
U.S. steel prices declined sharply in 2024 due to a slowdown in end-market demand and oversupply after a strong run in late 2023 that extended into early 2024. The benchmark hot-rolled coil (HRC) prices tumbled more than 40% last year from $1,200 per short ton at the start of 2024. The downside has been influenced by a concoction of factors, including a pullback in steel mill lead times, an oversupply of steel exacerbated by increased imports, reduced demand from key industries and economic uncertainties.
Sluggish industrial production and construction activities also contributed to the decline. While the recent steel mill price hikes have led to a modest uptick in HRC prices, a significant recovery is not expected over the near term given the weak manufacturing backdrop and demand weakness. Prices are currently hovering near the $700 per short ton level. Lower average selling prices are likely to have hurt NUE’s sales and margins in the quarter to be reported.
Our estimate for fourth-quarter average sales price per ton for the company’s steel mills unit stands at $928, suggesting an 8.6% year-over-year decrease and a 4% sequential decline. The same for total sales tons to outside customers for steel mills is pegged at 4,202,000 tons for the fourth quarter, suggesting an 8.8% decline from the prior quarter and a 4.4% year-over-year decrease.
Nucor Corporation Price and EPS Surprise
Nucor Corporation price-eps-surprise | Nucor Corporation Quote
Basic Materials Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they too have the right combination of elements to post an earnings beat this quarter:
Methanex Corporation MEOH, slated to release earnings on Jan. 29, has an Earnings ESP of +24.91% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for MEOH’s earnings for the fourth quarter is currently pegged at 94 cents.
ATI Inc. ATI, slated to release earnings on Feb. 4, has an Earnings ESP of +3.91% and carries a Zacks Rank #3 at present.
The consensus mark for ATI’s fourth-quarter earnings is currently pegged at 60 cents.
Kinross Gold Corporation KGC, scheduled to release fourth-quarter earnings on Feb. 12, has an Earnings ESP of +36.76%.
The Zacks Consensus Estimate for Kinross Gold’s earnings for the fourth quarter is currently pegged at 23 cents. KGC currently carries a Zacks Rank #3.
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