Nucor Corporation NUE lowered its earnings guidance for the third quarter ending Sept. 28 on Monday and said it expects earnings to be in the range of 75 cents to 80 cents per diluted share. The news sent shares of steel companies trading lower.
Nucor's second-quarter earnings were $1.26 per diluted share, and the guidance also represents a year-over-year decrease from earnings of $2.13 per diluted share in the third quarter of 2018.
The performance of the steel mills segment in the third quarter of 2019 is expected to decrease compared to the second quarter of 2019, primarily due to lower prices for sheet and plate steel.
“Although we still see stability in most of the end use markets that we serve, there has been some softening in automotive, agricultural products and power transmission markets,” the company said in a statement.
Outlook By Segment
Nucor said it expects the profitability of the steel products segment to improve sequentially in the third quarter, as nonresidential construction market conditions remain strong.
In addition, recently enacted efficiency initiatives in rebar fabrication and metal buildings are enhancing performance from those businesses, the company said.
Nucor said the performance of the raw materials segment is expected to decrease in the third quarter due to further margin compression in the company's direct reduced iron businesses.
Price Action
Nucor shares were trading down 1.06% at the time of publication.
Related Links:
US Steel Is The Latest Steel Manufacturer To Warn About Guidance
Bank Of America Cuts Steel Earnings Estimates Across The Board
Photo courtesy of Nucor.
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