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Nucor (NUE) Selects West Virginia for $2.7 Billion Sheet Mill

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Nucor Corporation NUE has announced that it will construct its new state-of-the-art sheet mill in Mason County, WV. The West Virginia location on the Ohio River offers Nucor significant transportation and logistics advantage and a strong ability to serve customers in the Midwest and Northeast, the two largest sheet-consuming regions in the United States. The new plant will employ roughly 800 full-time teammates once fully operational.

The new sheet mill is projected to cost roughly $2.7 billion and has the capacity to produce 3 million tons of steel each year. The new mill will be designed to produce 84-inch sheet products, and among other features, will include a 76-inch tandem cold mill and two galvanizing lines. Galvanizing capabilities will include an advanced high-end automotive line with full inspection capabilities and a construction-grade line.

Moreover, along with advanced capabilities and optimal strategic location, the new greenfield mill will have a considerably lower carbon footprint than competitors who have historically supplied the region.

The construction is anticipated to take two years, pending permit and regulatory approvals. Additional sites in Northern West Virginia are also under consideration for a transload and processing facility.

Nucor stated that its new sheet mill in Mason County will have unparalleled capabilities enabling the continued expansion of high-quality, low-carbon steels, building on its industry-leading offerings. It is pleased to create hundreds of new, high-paying jobs and position West Virginia as a leader in clean steel production. It is also excited to create substantial long-term value for investors through this high-return investment, which will help drive sustained growth for Nucor, the company noted.

Shares of Nucor have surged 102.4% in the past year compared with a 28.7% rise of the industry.

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Zacks Investment Research

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Nucor, last month, issued its guidance for the fourth quarter of 2021. It projects earnings in the band of $7.65-$7.75 per share. It expects that the fourth quarter will mark the highest quarterly earnings in Nucor’s history, surpassing third-quarter 2021’s record of $7.28.

Earnings in the steel mills segment remained strong in the fourth quarter, Nucor noted. It is projected to be comparable to third-quarter levels, despite the company encountering lower volumes due to year-end seasonality.

The company anticipates fourth-quarter earnings in the steel products segment to increase, driven by strong demand in non-residential construction. Nucor sees solid demand in most of its end markets. The company is confident that 2022 will be another year of strong profitability for Nucor.

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 Albemarle Corporation ALB, Commercial Metals Company CMC and AdvanSix Inc. ASIX.

Albemarle, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 51.5% for the current year. The Zacks Consensus Estimate for ALB's earnings for the current year has been revised 5.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.

Albemarle beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with the average being 22.1%. ALB has rallied around 32.1% over a year.

Commercial Metals, flaunting a Zacks Rank #1 at present, has a projected earnings growth rate of 10.5% for the current fiscal year. CMC's consensus estimate for the current fiscal year has been revised 6.6% upward in the past 60 days.

Commercial Metals beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing the same once. It delivered a trailing four-quarter earnings surprise of roughly 13.1%, on average. CMC has rallied around 69% over a year.

AdvanSix has a projected earnings growth rate of 3.9% for the current year. The Zacks Consensus Estimate for ASIX’s earnings for the current year has been revised 2% upward in the past 60 days.

AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, with the average being 46.9%. ASIX has rallied 100.9% over a year. It currently carries a Zacks Rank #2 (Buy).


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Nucor Corporation (NUE) : Free Stock Analysis Report

Albemarle Corporation (ALB) : Free Stock Analysis Report

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AdvanSix (ASIX) : Free Stock Analysis Report

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