Steel and steel products manufacturer Nucor Corporation (NYSE: NUE) has made shareholders happy with the announcement that its earnings in the second quarter of 2022 (ending July 2, 2022) will break the existing quarterly record.
Investors reacted positively to the news, and the stock price of the company rose 2.4% to close at $116.46 in the normal trading hours on Wednesday. Shares of the company grew an additional 1.2% in the extended trading session.
Inside the Headlines
For the second quarter of 2022, Nucor anticipates earnings within the $8.75-$8.85 per share range. The projection is higher than the $7.97 per share recorded in the fourth quarter of 2021 — highest earnings ever recorded in a quarter.
Further, the projection is expected to exceed earnings of $5.04 per share recorded in the year-ago quarter and $7.67 per share in the first quarter of 2022.
The company noted that the increased profitability in all three segments will likely support its second-quarter earnings performance.
The company’s Steel Products segment is anticipated to profit from the demand surge in the nonresidential construction markets. Likewise, benefits from plate, bar and sheet mills are likely to add vigor to the Steel Mills segment. Also, improved selling prices will boost profitability in the Raw Materials segment.
In addition to the earnings guidance, Nucor discussed its rewards to shareholders. The company has bought back 5.1 million shares (at the rate of $157.37 per share) in the second quarter and 12.1 million shares (for $140.59 each share) so far this year.
Combining share buybacks and dividends, Nucor has rewarded shareholders with $1.9 billion.
Nucor is expected to report results for the second quarter of 2022 on July 21. The consensus estimate for earnings is pegged at $8.25 per share.
Stock Rating
On June 15, Andreas Bokkenheuser of UBS reiterated a Neutral rating on NUE while lowering the price target to $120 (3.03% upside potential) from $160.
Overall, the company has a Hold consensus rating on NUE based on two Buys, seven Holds, and one Sell. NUE’s average price target of $141.33 suggests 21.34% upside potential from current levels. Shares of the $31-billion company have grown 16.5% over the past year.
Crowd Wisdom
As per TipRanks, investors’ sentiment is presently Negative on NUE. The number of portfolios with exposure to the stock has decreased 0.2% in the last seven days and 0.4% in the last 30 days.
Conclusion
With its impressive second-quarter projections, Nucor seems to be well-positioned to leverage healthy demand for steel and steel products. Further, its commitment to reward shareholders through dividends and buybacks is visible from the data provided for the second quarter.
Read full Disclosure
