Steel Dynamics Issues Caution on Q3 Outlook - What's Going On?

Steel Dynamics, Inc. STLD shares drop following the release of its 3Q23 earnings guidance.

The company projected 3Q EPS of $3.46 and $3.50 versus a consensus of $3.61. This is a decrease compared to 3Q23 EPS of $4.81 and $5.03 in 3Q22.

The company stated that its profitability of steel operations in Q3 is expected to decline due to lower realized flat rolled steel pricing outweighing lower scrap costs. 

Steel shipments are anticipated to be similar to Q2, except for volume lost during an unplanned outage in July at Sinton.

 Steel orders continue to 

Q3 earnings for STLD’s metals recycling operations are expected to decrease compared to Q2 due to reduced volume and lower metal prices throughout the quarter.

Earnings from steel fabrication operations in Q3 are also expected to be lower than the prior quarter due to decreased shipments and metal pricing, coupled with increased steel input costs.

As of August 31, 2023, the company has repurchased $920 million worth of shares and paid $202 million in cash dividends to shareholders during the year.

Price Action: STLD shares are trading higher by 0.64% at $99.34 on the last check Monday.