Steel Dynamics (STLD) Dips More Than Broader Markets: What You Should Know
Steel Dynamics (STLD) closed at $82.54 in the latest trading session, marking a -1.27% move from the prior day. This change lagged the S&P 500's daily loss of 1.26%. Meanwhile, the Dow lost 0.8%, and the Nasdaq, a tech-heavy index, lost 0.28%.
Prior to today's trading, shares of the steel producer and metals recycler had gained 15.5% over the past month. This has outpaced the Basic Materials sector's gain of 6.12% and the S&P 500's gain of 6.07% in that time.
Wall Street will be looking for positivity from Steel Dynamics as it approaches its next earnings report date. In that report, analysts expect Steel Dynamics to post earnings of $5.51 per share. This would mark year-over-year growth of 162.38%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.23 billion, up 47.67% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $15.11 per share and revenue of $19.67 billion. These totals would mark changes of -6.09% and +6.83%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Steel Dynamics. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 11.22% higher. Steel Dynamics is currently a Zacks Rank #1 (Strong Buy).
Investors should also note Steel Dynamics's current valuation metrics, including its Forward P/E ratio of 5.53. Its industry sports an average Forward P/E of 4.61, so we one might conclude that Steel Dynamics is trading at a premium comparatively.
The Steel - Producers industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 26, putting it in the top 11% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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