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Nucor (NUE) Misses Earnings and Revenue Estimates in Q1

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·4 min read
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Nucor Corporation NUE registered net earnings of $942.4 million or $3.10 per share in first-quarter 2021, up from $20.3 million or 7 cents in the year-ago quarter. Notably, first-quarter marked the most profitable quarter in the steel giant’s history. However, earnings per share missed the Zacks Consensus Estimate of $3.14.

The company recorded net sales of $7,017.1 million, up around 25% year over year. The figure also trailed the Zacks Consensus Estimate of $7,474.8 million.

Nucor Corporation Price, Consensus and EPS Surprise

Nucor Corporation Price, Consensus and EPS Surprise
Nucor Corporation Price, Consensus and EPS Surprise

Nucor Corporation price-consensus-eps-surprise-chart | Nucor Corporation Quote

Operating Figures

Total steel mills shipments in the first quarter were 6,544,000 tons, up 1% year over year. Total tons shipped to outside customers were down modestly year over year to 7,176,000 tons. Moreover, average sales price rose 25% year over year.

Steel mill operating rates were 95% in the first quarter, up from 89% in the year-ago quarter.

Segment Highlights

The company’s steel mills unit benefited from higher average selling prices and strong demand in the first quarter. Profitability rose in its sheet, bar, plate and structural mills sequentially in the first quarter with sheet mills witnessing the biggest rise.

The steel products unit also had another strong quarter with profitability rising on a sequential comparison basis.

Moreover, profitability in the raw materials unit improved significantly in the reported quarter compared with fourth-quarter levels on higher selling prices for raw materials.

Financial Position

At the end of the quarter, cash and cash equivalents surged roughly 97% year over year to $2,460.7 million. Long-term debt was $5,273 million, up around 24% year over year.

The company repurchased roughly 5.4 million shares of its common stock during the quarter.

Outlook

Moving ahead, Nucor expects second-quarter earnings to be the highest quarterly earnings in its history, exceeding the record-level set in the first quarter. Earnings are expected to be mainly driven by higher pricing and margins in the steel mills segment.

The company also sees another strong quarter for the steel products segment with second-quarter profitability projected to be comparable to the first quarter.

Nucor also sees profitability in the raw materials segment to decline in the second quarter compared with the first quarter on higher raw material input costs.

Price Performance

Shares of Nucor have rallied 120.2% over a year compared with the industry’s 159.9% rise.

Zacks Rank & Key Picks

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

Other top-ranked stocks worth considering in the basic materials space include Dow Inc. DOW, Fortescue Metals Group Limited FSUGY and Impala Platinum Holdings Limited IMPUY.

Dow has a projected earnings growth rate of 171.7% for the current year. The company’s shares have rallied around 104% in a year. It currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Fortescue has a projected earnings growth rate of 104.9% for the current fiscal. The company’s shares have shot up around 145% in a year. It currently sports a Zacks Rank #1.

Impala Platinum has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have surged around 284.3% in the past year. It currently carries a Zacks Rank #1.

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