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Nucor (NUE) to Report Q4 Earnings: What's in the Cards?
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Nucor Corporation (NUE - Free Report) is set to release fourth-quarter 2020 results ahead of the bell on Jan 28. The company’s results are likely to reflect strength in non-residential construction and automotive markets and higher steel prices.
The U.S. steel giant surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 57.5%. It posted an earnings surprise of 18.9% in the last reported quarter.
Nucor’s shares are up 11.4% over a year, compared with the industry’s 29.8% rise.
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
Nucor, last month, issued earnings guidance for the fourth quarter. It expects earnings per share between $1.15 and $1.20 per share. The guidance suggests a sequential rise from 63 cents recorded in the third quarter and a year-over-year increase from 35 cents recorded in the prior-year quarter.
The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Nucor is currently pegged at $5,405 million, reflecting a year-over-year increase of 5.3%.
Moreover, the Zacks Consensus Estimate for total steel mills shipments for the quarter currently stands at 5,625,000 tons, indicating a decline of 2.7% year over year. The consensus estimate for total tons shipped to outside customers is currently pegged at 6,375,000 tons, reflecting a decrease of 1.7 % on a year-over-year basis.
The Zacks Consensus Estimate for average sales price per ton for the company’s steel mills unit stands at $672, suggesting a 1.4% year-over-year increase. The same for the steel products unit is pegged at $1,385, indicating a year-over-year decline of 2.9%.
A Few Factors to Watch
The company is likely to have gained, in the fourth quarter, from strength in its non-residential construction markets and a strong recovery in the automotive market. Its bar and structural mills are expected to have benefited from non-residential construction. Strong customer demand has also led to a rebound in the automotive market. Moreover, higher prices are likely to have supported the company’s results.
Nucor, in December, said that it expects earnings to improve on back of higher pricing at its sheet and plate mills. The steel mills segment also continues to benefit from strong results at Nucor bar and structural mills. The company also expects raw material segment’s profitability to rise in the fourth quarter sequentially owing to improved financial performance of direct reduced iron facilities that are benefitting from high prices of raw materials. However, the steel products segment’s earnings are projected to decline sequentially due to typical seasonality.
Meanwhile, U.S. steel prices have staged a strong recovery and hit record levels after plunging to pandemic-led multi-year lows in August 2020. The rebound has been driven by rising demand, supply shortages and higher raw material costs.
Weak end-market demand put significant pressure on benchmark hot-rolled coil (“HRC”) prices in July and August. However, HRC prices started to recover in September on U.S. steel mills’ back-to-back price hike actions, tight supply and surging end-market demand, especially in automotive. Prices are shooting higher since then and have surged to levels not seen in more than a decade.
As such, improved domestic steel prices are likely to have boosted Nucor’s selling prices and aided its revenues and margins in the to-be-reported quarter.
Our proven model does not conclusively predict an earnings beat for Nucor this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Nucor is -1.64%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at $1.22. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Nucor currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Celanese Corporation (CE - Free Report) , scheduled to release earnings on Jan 28, has an Earnings ESP of +2.38% and carries a Zacks Rank #2.
Eastman Chemical Company (EMN - Free Report) , scheduled to release earnings on Jan 28, has an Earnings ESP of +16.17% and carries a Zacks Rank #3.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.4% per year.
These 7 were selected because of their superior potential for immediate breakout.
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Nucor (NUE) to Report Q4 Earnings: What's in the Cards?
Nucor Corporation (NUE - Free Report) is set to release fourth-quarter 2020 results ahead of the bell on Jan 28. The company’s results are likely to reflect strength in non-residential construction and automotive markets and higher steel prices.
The U.S. steel giant surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 57.5%. It posted an earnings surprise of 18.9% in the last reported quarter.
Nucor’s shares are up 11.4% over a year, compared with the industry’s 29.8% rise.
Let’s see how things are shaping up for this announcement.
What do the Estimates Say?
Nucor, last month, issued earnings guidance for the fourth quarter. It expects earnings per share between $1.15 and $1.20 per share. The guidance suggests a sequential rise from 63 cents recorded in the third quarter and a year-over-year increase from 35 cents recorded in the prior-year quarter.
The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Nucor is currently pegged at $5,405 million, reflecting a year-over-year increase of 5.3%.
Moreover, the Zacks Consensus Estimate for total steel mills shipments for the quarter currently stands at 5,625,000 tons, indicating a decline of 2.7% year over year. The consensus estimate for total tons shipped to outside customers is currently pegged at 6,375,000 tons, reflecting a decrease of 1.7 % on a year-over-year basis.
The Zacks Consensus Estimate for average sales price per ton for the company’s steel mills unit stands at $672, suggesting a 1.4% year-over-year increase. The same for the steel products unit is pegged at $1,385, indicating a year-over-year decline of 2.9%.
A Few Factors to Watch
The company is likely to have gained, in the fourth quarter, from strength in its non-residential construction markets and a strong recovery in the automotive market. Its bar and structural mills are expected to have benefited from non-residential construction. Strong customer demand has also led to a rebound in the automotive market. Moreover, higher prices are likely to have supported the company’s results.
Nucor, in December, said that it expects earnings to improve on back of higher pricing at its sheet and plate mills. The steel mills segment also continues to benefit from strong results at Nucor bar and structural mills. The company also expects raw material segment’s profitability to rise in the fourth quarter sequentially owing to improved financial performance of direct reduced iron facilities that are benefitting from high prices of raw materials. However, the steel products segment’s earnings are projected to decline sequentially due to typical seasonality.
Meanwhile, U.S. steel prices have staged a strong recovery and hit record levels after plunging to pandemic-led multi-year lows in August 2020. The rebound has been driven by rising demand, supply shortages and higher raw material costs.
Weak end-market demand put significant pressure on benchmark hot-rolled coil (“HRC”) prices in July and August. However, HRC prices started to recover in September on U.S. steel mills’ back-to-back price hike actions, tight supply and surging end-market demand, especially in automotive. Prices are shooting higher since then and have surged to levels not seen in more than a decade.
As such, improved domestic steel prices are likely to have boosted Nucor’s selling prices and aided its revenues and margins in the to-be-reported quarter.
Nucor Corporation Price and EPS Surprise
Nucor Corporation price-eps-surprise | Nucor Corporation Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Nucor this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Nucor is -1.64%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at $1.22. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Nucor currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
LyondellBasell Industries N.V. (LYB - Free Report) , scheduled to release earnings on Jan 29, has an Earnings ESP of +5.36% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Celanese Corporation (CE - Free Report) , scheduled to release earnings on Jan 28, has an Earnings ESP of +2.38% and carries a Zacks Rank #2.
Eastman Chemical Company (EMN - Free Report) , scheduled to release earnings on Jan 28, has an Earnings ESP of +16.17% and carries a Zacks Rank #3.
Just Released: Zacks’ 7 Best Stocks for Today
Experts extracted 7 stocks from the list of 220 Zacks Rank #1 Strong Buys that has beaten the market more than 2X over with a stunning average gain of +24.4% per year.
These 7 were selected because of their superior potential for immediate breakout.
See these time-sensitive tickers now >>