Nucor's Q2 Earnings Beat Expectations, But Analyst Warns of Weaker Q3 Due to Lower Steel Prices

Nucor Corporation NUE shares are trading lower today. Yesterday, the company reported better-than-expected second-quarter financial results.

Nucor reported quarterly earnings of $2.68 per share, which beat the analyst consensus estimate of $2.35 by 14.04%. Quarterly sales came in at $8.08 billion, which beat the analyst consensus estimate of $7.69 billion by 5.13%.

Nucor anticipates a decline in third-quarter 2024 earnings compared to the second quarter, primarily due to lower average selling prices impacting the steel mills segment.

KeyBanc Capital Markets analyst Philip Gibbs says that 3Q24 guidance suggests weaker earnings in Steel Products and Raw Materials than his current model.

The analyst notes that NUE’s average realized carbon sheet pricing/mix in 2024 remained above $1,000/t, compared to the current HRC spot price of ~$650/t and tandem product base prices of ~$875-$975/t (with NUE’s mix being roughly 50% HRC).

The analyst writes that this suggests NUE was shipping from a strong backlog. Additionally, the average realized plate pricing/mix exceeded $1,300/t, while the current baseline index pricing is $1,000-$1,050/t.

Investors can gain exposure to the stock via VanEck Steel ETF SLX and Carbon Collective Climate Solutions U.S. Equity ETF CCSO.

Price Action: NUE shares are down 0.97% at $161.75 at the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image: Courtesy of Nucor Corporation