Shares of the steel and steel products manufacturer Nucor Corporation (NYSE:NUE) are up about 29% in 2023. NUE stock got a lift from its solid Q4 and 2022 earnings results. Meanwhile, management’s upbeat outlook for 2023 acted as a catalyst. However, fear of an economic slowdown could hurt Nucor’s prospects and limit the upside.
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Despite tough year-over-year comparisons, Nucor delivered record net earnings of $7.61 billion, or $28.79 per share, in 2022. In 2021, Nucor generated net earnings of $6.83 billion, or $23.16 per share. As for Q4, it delivered an EPS of $4.89 that surpassed Street’s expectations of $4.16.
During the Q4 conference call, Nucor announced that its earnings could remain strong in 2023, regardless of economic uncertainty. Management’s upbeat outlook stems from higher non-residential construction spending coupled with federal support for infrastructure and energy projects.
Management also highlighted that the medium- and long-term industry fundamentals and demand drivers remain relatively positive. Moreover, through its growth initiatives and investments, the company is poised to capitalize on positive industry trends.
Is Nucor Stock a Buy?
Nucor stock has one Buy and two Hold recommendations, translating into a Moderate Buy consensus rating on TipRanks. While management’s optimistic outlook should support NUE stock, the recent appreciation in value and fear of recession could restrict the upside.
Meanwhile, analysts’ average price target of $157.33 shows a downside of 7.35% from current levels. Further, with negative indicators from hedge funds and insiders, Nucor stock has a Neutral Smart Score of five.
