Nucor Corporation (NYSE:NUE) Quarterly Earnings Preview

Nucor (NYSE:NUE) shares rose more than 4% today after UBS upgraded the stock from Neutral to Buy, raising its price target slightly to $160 from $156, pointing to stronger-than-expected tariff support, favorable pricing trends, and recent share price de-rating as catalysts for renewed upside.

Since early December, Nucor’s valuation has compressed, now trading at around 7.5x UBS’s 2025 EV/EBITDA estimates, down from roughly 9x. At the same time, steel prices have surged, fueled by the U.S. government's announcement of 25% tariffs under Section 232, which have spurred a wave of near-term panic buying.

UBS expects steel prices to moderate in the second half of 2025, but believes the reshoring trend and elevated import protection levels—including potential additional tariffs on specific countries—offset the risks tied to declining demand and policy uncertainty.

The firm maintains confidence in medium-term hot-rolled coil (HRC) prices above $800 per short ton, supported by a rising cost curve driven by scrap prices and a tighter import parity environment. These dynamics have already helped revive the plate market, with Nucor’s Products segment set to benefit from tariffs on downstream goods.

Nucor Corporation (NYSE:NUE) is a prominent player in the steel industry, known for its diverse range of steel products and services. As a leader in the Zacks Steel - Producers industry, Nucor has consistently demonstrated its ability to outperform market expectations. The company is set to release its quarterly earnings on January 27, 2025, with analysts estimating an EPS of $0.94 and projected revenue of $6.73 billion.

Nucor has a strong track record of surpassing earnings estimates, with an average earnings surprise of 7.4% over the last four quarters, as highlighted by Zacks. In the most recent quarter, Nucor exceeded expectations with a 6.43% earnings surprise, reporting $1.49 per share against an anticipated $1.40.

This consistent performance has led to upward revisions in earnings estimates, indicating optimism about its financial prospects. Despite the positive outlook, Nucor's steel mills segment faces challenges due to weaker selling prices, which may impact fourth-quarter results. The company's shares have declined by 30.1% over the past year, compared to a 24.5% decline in the Zacks Steel Producers industry. However, a positive Earnings ESP and a strong Zacks Rank suggest a potential earnings beat for Nucor. Nucor's financial metrics provide insight into its market valuation and operational efficiency.

With a P/E ratio of 11.44, the market values Nucor's earnings moderately. The company's price-to-sales ratio of 0.91 indicates that investors pay less than one dollar for every dollar of sales. Additionally, Nucor's enterprise value to sales ratio of 1.00 reflects its total valuation relative to sales. Nucor's financial health is further supported by a debt-to-equity ratio of 0.34, indicating moderate debt levels. The company's current ratio of 2.59 suggests strong short-term liquidity, while an earnings yield of 8.74% offers an attractive return on earnings. These metrics highlight Nucor's ability to generate cash flow efficiently, with an enterprise value to operating cash flow ratio of 6.58.

Nucor Corporation (NYSE: NUE) is a leading player in the steel production industry, known for its innovative approach and extensive product range. The company operates in a competitive market, with key rivals including U.S. Steel and ArcelorMittal. Nucor's recent financial performance provides insights into its current market position and future prospects.

On October 21, 2024, Nucor reported earnings per share (EPS) of $1.05, which fell short of the estimated $1.50. Despite this, the company generated revenue of approximately $7.44 billion, surpassing the estimated $7.28 billion. This revenue figure, however, represents a 15.2% decline compared to the same period last year, as highlighted by Zacks.

Nucor's EPS for the third quarter of 2024 was $1.49, a significant drop from the $4.57 reported in the previous year. Despite the decrease, this EPS figure exceeded the consensus estimate of $1.40, resulting in a positive surprise of 6.43%. This marks the third time in the past four quarters that Nucor has surpassed consensus EPS estimates.

In terms of revenue, Nucor's $7.44 billion for the quarter ending September 2024 exceeded the Zacks Consensus Estimate by 3.33%. However, this is a decline from the $8.78 billion reported in the same period last year. Nucor has consistently outperformed consensus revenue estimates in the last four quarters, demonstrating its resilience in a challenging market.

Nucor's financial health is further underscored by its price-to-earnings (P/E) ratio of approximately 10.95 and a price-to-sales ratio of about 1.13. The company's debt-to-equity ratio of 0.33 indicates a relatively low level of debt compared to equity, while a strong current ratio of 2.93 suggests good short-term financial health and liquidity.

On Monday, April 22, 2024, Nucor Corporation (NUE:NYSE) disclosed its financial outcomes for the first quarter, revealing an earnings per share (EPS) of $3.47, which did not meet the anticipated $3.62. The company's revenue for the period was reported at approximately $8.14 billion, falling short of the expected $8.26 billion. This announcement set the stage for a challenging market response, as investors and analysts had set higher financial benchmarks for the steel producer.

Following the earnings report, Nucor's stock experienced a significant downturn, dropping over 6% before the market opened on Tuesday. This decline was a direct consequence of the company's inability to meet Wall Street's financial expectations for the quarter. Additionally, Nucor's forecast for the upcoming quarter was less optimistic than anticipated, primarily due to anticipated lower selling prices for its products, as reported by Investopedia on April 23, 2024. This forecast adjustment reflects the company's realistic assessment of the market conditions and its impact on future earnings.

Despite the earnings miss, Nucor's financial performance showcased some positive aspects. The company reported net earnings of approximately $844.8 million, translating to $3.46 per diluted share, which, while below the expected EPS, still represents a robust financial outcome compared to the previous quarters. This performance underscores Nucor's resilience and its ability to generate significant earnings amidst fluctuating market conditions. Furthermore, the company's strategic initiatives, such as expanding its capabilities in the data center market and focusing on sustainability through partnerships for low carbon steel, highlight its commitment to growth and innovation.

Nucor's financial health and valuation metrics also provide a broader perspective on its market position. With a price-to-earnings (P/E) ratio of approximately 11.00, Nucor appears to be undervalued when considering its earnings potential. The company's price-to-sales (P/S) ratio of about 1.35 and an enterprise value to sales (EV/Sales) ratio of roughly 1.42 suggest that the stock is reasonably valued in relation to its revenue. Additionally, the enterprise value to operating cash flow (EV/OCF) ratio of approximately 7.61 indicates efficient cash flow generation relative to its total valuation. These metrics, combined with a strong liquidity position as evidenced by a current ratio of approximately 4.02, suggest that Nucor is well-positioned to navigate the challenges ahead and capitalize on future opportunities.

In summary, Nucor Corporation's first-quarter financial results for 2024 reflect a mixed performance, with the company facing challenges in meeting earnings expectations but demonstrating resilience in revenue generation and strategic growth initiatives. The market's reaction, characterized by a significant stock price drop, underscores the importance of meeting financial forecasts in maintaining investor confidence. However, Nucor's solid financial health, strategic focus on sustainability and innovation, and favorable valuation metrics indicate a potential for recovery and growth in the face of market adversities.