Nucor Earnings Preview

Nucor Corporation (NUE) is scheduled to report its Q2 2012 results on July 19, 2012, after the bell. The street expects EPS and revenue of $0.48 and $5.06B, respectively.

In this article I will recap the historical results of the company, its latest EPS estimates vs. surprises, the latest news from NUE and the news from its closest competitors.

Recent EPS Actuals vs. Estimates

The company has met or beaten analysts' estimates in the last four quarters. In the last quarter it reported $0.42 EPS, beating analyst estimates of $0.39.

The consensus EPS estimate is $0.48 based on 19 analysts' estimates, down from $0.94 a year ago. Revenue estimates are $5.06B, just below $5.11B a year ago. The median target price by analysts for the stock is $45.00.

Average recommendation: Overweight

Source: Marketwatch

Analyst Upgrades and Downgrades

• On February 21, 2012, Longbow downgraded the company from Buy to Neutral.
• On January 26, 2012, Deutsche Bank downgraded the company from Buy to Hold.

Latest News

• On June 21, 2012, Nucor Corporation announced that it has completed the acquisition of the membership interest of Skyline Steel LLC and subsidiaries for the purchase price of approximately $605 million.
• On June 13, 2012, Nucor Corporation announced that for the second quarter of 2012, it expects results to be in the range of $0.35 to $0.40 per diluted share. These projected results include an expected impairment charge related to Duferdofin Nucor S.r.l. joint venture of approximately $30 million ($0.09 per diluted share).
• On May 18, 2012, ArcelorMittal announced the sale of its steel foundation distribution business in NAFTA, namely Skyline Steel and Astralloy (Skyline Steel) to Nucor Corporation (Nucor) for a total consideration of approximately $605 million on a debt free and cash free basis (and subject to customary closing adjustments).
• On April 19, 2012, Nucor Corporation announced that for the second quarter of 2012, it currently expect to see only a modest improvement in earnings.
• On February 15, 2012, Nucor Corporation announced that the Board of Directors has declared the regular quarterly cash dividend of $0.365 per share on Nucor's common stock. This cash dividend is payable on May 11, 2012 to stockholders of record on March 30, 2012.
• On January 26, 2012, Nucor Corporation announced that it expect earnings in the first quarter of 2012 to be improved from fourth quarter 2011 levels, after adjusting for one-time benefits received in the fourth quarter.

Competitors

AK Steel Holding Corporation (AKS), Commercial Metals Company (CMC), Steel Dynamics Inc. (STLD), and United States Steel Corp. (X) are considered major competitors for Nucor and the table below provides the key metrics for these companies and the industry.

The chart below compares the stock price changes as a percentage for the selected companies and S&P 500 index for the last one year period.

(click to enlarge)

NUE data by YCharts

Competitors' Latest Development

• On June 27, 2012, Commercial Metals Company announced that the Board of Directors of CMC declared a quarterly dividend of $0.12 on June 26 for shareholders of record on July 11, 2012.
• On June 18, 2012, AK Steel announced that for second quarter of 2012, it expects net income of between $0.04 and $0.06 per diluted share (EPS) of common stock, which would represent an improvement compared to the loss of $0.11 per diluted share reported for the first quarter of 2012.
• On June 4, 2012, Commercial Metals Company announced the completion of the sale of Croatian Pipe Mill and wholly owned subsidiary, CMC Sisak, d.o.o. (CMC Sisak), pursuant to a definitive purchase agreement whereby CMC sold all of the outstanding shares of CMC Sisak to the Danieli Group - Steel Making Division by the Danieli holding company, Industrielle Beteiligung SA (Danieli).
• On March 20, 2012, AK Steel announced that its subsidiary, AK Steel Corporation (AK Steel), has successfully priced a public offering of $300 million of 8.375% senior notes due 2022.
• On March 12, 2012, United States Steel Corp announced the pricing of its public offering of $400,000,000 aggregate principal amount of 7.500% Senior Notes due 2022. The Notes were priced at 100% of the principal amount.
• On March 12, 2012, United States Steel Corp announced its intention to offer, subject to market and other conditions, $400 million aggregate principal amount of senior unsecured notes due 2022.
• On January 31, 2012, United States Steel Corp announced that for the first quarter of 2013, it expects to report a significant improvement in the operating results as compared to the fourth quarter, mainly driven by improved average realized prices and shipments for the Flat-rolled segment.
• On January 30, 2012, United States Steel Corp announced a plan for the sale of U. S. Steel Serbia d.o.o. to the Republic of Serbia for a nominal purchase price, subject to finalization and execution of definitive agreements.

Technical Overview

The stock has a market capitalization of $12.18B and is currently trading at $38.42 with a 52 week range of $29.82 - $45.75. The stock's year-to-date performance has been -1.11%. It is currently trading above 20 and 50 SMA, but below 200 SMA.

Sources: Yahoo Finance, Google Finance, Marketwatch, Finviz, Reuters.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.