Nucor's (NUE) Earnings and Revenues Beat Estimates in Q3
Nucor Corporation NUE recorded net earnings of $1,694.7 million or $6.50 per share in third-quarter 2022, down from net earnings of $2,127.7 million or $7.28 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $6.45.
The company logged net sales of $10,500.8 million, up around 2% year over year. The figure beat the Zacks Consensus Estimate of $9,995.1 million.
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 third quarter were 5,869,000 tons, down 10% year over year. Total tons shipped to outside customers were down 11% year over year to 6,415,000 tons. Average sales price rose 14% year over year and fell 3% sequentially.
Steel mill operating rates were 77% in the quarter, down from 96% in the year-ago quarter.
Segment Highlights
Earnings of the company’s steel mills unit declined on a sequential comparison basis in the reported quarter, hurt by metal margin contraction and lower shipping volumes, especially at its sheet and plate mills.
Earnings in the steel products unit were modestly higher sequentially in the third quarter.
Earnings in the raw materials unit were up in the third quarter as higher profitability of the company’s direct reduced iron facilities offset reduced profitability in scrap brokerage and processing operations.
Financial Position
At the end of the quarter, cash and cash equivalents rose roughly 73% year over year to $3,049.9 million. Long-term debt was $6,617 million, up around 34% year over year.
The company repurchased roughly 5.3 million shares of its common stock during the third quarter.
Outlook
Moving ahead, the company envisions earnings to decline sequentially in the fourth quarter of 2022.
Nucor expects earnings in the steel mills segment to be considerably lower sequentially in the fourth quarter due to lower average selling prices and lower volumes, with the biggest decline in profitability expected at its sheet mills.
The steel products segment’s profitability is also projected to decline sequentially in the fourth quarter due to seasonality. The company also sees raw materials segment earnings to decline significantly in the fourth quarter due to lower selling prices for raw materials.
Price Performance
Shares of Nucor have gained 15.9% over a year compared with the industry’s 17.6% decline.
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Zacks Rank & Other Key Picks
Nucor currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks worth considering in the basic materials space include Albemarle Corporation ALB, Sociedad Quimica y Minera de Chile S.A. SQM and Ryerson Holding Corporation RYI.
Albemarle, currently sporting a Zacks Rank #1 (Strong Buy), has a projected earnings growth rate of 426.7% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 5% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Albemarle’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 24.2%, on average. ALB has gained around 10% in a year.
Sociedad has a projected earnings growth rate of 530.7% for the current year. The Zacks Consensus Estimate for SQM’s current-year earnings has been revised 2.1% upward in the past 60 days.
Sociedad has a trailing four-quarter earnings surprise of roughly 27.2%. SQM has rallied roughly 69% in a year. The company currently carries a Zacks Rank #1.
Ryerson Holding, currently carrying a Zacks Rank #2 (Buy), has an expected earnings growth rate of 74.2% for the current year. The consensus estimate for RYI's earnings for the current year has been revised 3.2% upward in the past 60 days.
Ryerson Holding’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 28.9%. RYI has gained around 23% over a year.
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