21 May

How Analysts Are Rating Nucor Stock in May

WRITTEN BY Mohit Oberoi, CFA

Nucor

Nucor (NUE), the largest US-based steel producer, has received “strong buy” ratings from four analysts, while seven have given it “buy” ratings. The remaining four analysts polled by Thomson Reuters have given it “hold” or equivalent ratings.

How Analysts Are Rating Nucor Stock in May

Analyst action

Nucor stock has received a mean consensus target price of $68.46, which represents a potential upside of 30.1% over its May 20 closing price. In contrast, the stock carried a target price of $69.11 on April 22, the day before its earnings release. There wasn’t any major analyst action following Nucor’s first-quarter earnings release. JPMorgan Chase and Jefferies lowered their target prices for Nucor by $1 each to $80 and $67, respectively. This month, UBS lowered Nucor’s target price from $59 to $57, while Cowen lowered its target price from $65 to $64.

Earnings

Nucor’s first-quarter earnings were better than expected. It reported EPS of $1.63 in the quarter compared to EPS of $2.07 in the fourth quarter and $1.10 in the first quarter of 2018. Analysts had expected Nucor to post EPS of $1.50 in the quarter, while Nucor had provided EPS guidance of $1.45–$1.50.

Nucor reported revenue of $6.1 billion in the first quarter compared to $6.3 billion in the fourth quarter and $5.6 billion in the first quarter of 2018. Its revenue was largely in line with estimates.

The broader steel space has come under pressure amid the escalation in the US-China trade war. President Donald Trump’s decision to remove Section 232 tariffs on Canada and Mexico has also played heavy on the sector. Read Has President Trump Betrayed US Steel Companies’ Trust? for more analysis.

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