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Nucor (NUE) Expects Record Earnings in Q1 on Solid Demand, Prices

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Nucor Corporation NUE announced its guidance for the first quarter of 2021. The company projects first-quarter earnings of $3.00-$3.10 per share. Its first-quarter earnings are expected to exceed the previous record set in the third quarter of 2008 and be the highest quarterly earnings in the history of Nucor.

The company expects March to be the strongest month of the first quarter. An expansion in margins is seen since the beginning of the year and is expected to continue to the second quarter. Earnings in the second quarter are also projected to set a new record.

All three segments of the company are generating strong results, per Nucor. The steel mills and raw materials segments are benefiting from strong steel demand and higher prices. The company expects the performance of these units to be considerably higher on a sequential basis in the first quarter. The product groups in the steel mills segment are expecting higher first-quarter results than the fourth quarter of 2020, with the biggest increases from sheet and plate mills. Nucor is also benefiting from strong demand across most of its end markets.

The company also repurchased 5.4 million shares at an average price of $56.11 per share in the first quarter. The company has returned more than $420 million to stockholders in the form of share repurchases and dividend payments year to date. Nucor, driven by strong cash flow from operations, expects to end the quarter with more than $4.5 billion in financial liquidity, including its $1.5-billion undrawn revolving credit facility.

Shares of Nucor have gained 134.8% in the past year compared with a 198% rise of the industry.

Zacks Rank & Other Key Picks

Nucor currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the basic materials space are Fortescue Metals Group Limited FSUGY, Ashland Global Holdings Inc. ASH and Impala Platinum Holdings Limited IMPUY.

Fortescue has a projected earnings growth rate of 107.8% for the current fiscal year. The company’s shares have surged 182.3% in a year. It currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ashland has an expected earnings growth rate of 83.9% for the current fiscal year. The company’s shares have gained 106.9% in the past year. It currently sports a Zacks Rank #1.

Impala has an expected earnings growth rate of 197.6% for the current fiscal year. The company’s shares have rallied 483.3% in the past year. It currently flaunts a Zacks Rank #1.

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