Jefferies Initiating Coverage On STLD

Jefferies is initiating coverage on Steel Dynamics STLD with a Buy rating and a price target set at $20. According to Jefferies, “We're initiating coverage on STLD with a BUY-rating and $20 price target. Following the 21% pullback in valuations from YTD highs (currently 8.2x 2012E EPS), current prices represent an attractive entry point ahead of improving industry fundamentals in 2012 and beyond. Our $20 target price values the shares at 10.0x 2012E EPS; in line with long term historical median cycle multiples.” STLD closed at $16.44 yesterday.