Stock of the Day

September 20, 2019

Nucor (NUE)

$122.50
+$3.75 (+3.2%)
Market Cap: $28.26B

About Nucor

Nucor Corporation engages in manufacture and sale of steel and steel products. It operates in three segments: steel mills, steel products, and raw materials. The Steel Mills segment produces hot-rolled, cold-rolled, and galvanized sheet steel products; plate steel products; wide-flange beams, beam blanks, and H-piling and sheet piling structural steel products; bar steel products, such as blooms, billets, concrete reinforcing and merchant bars, and engineered special bar quality products; and engages in the steel trading and rebar distribution businesses. This segment sells its products to steel service centers, fabricators, and manufacturers in the United States, Canada, and Mexico. The Steel Products segment offers steel joists and joist girders, steel decks, and galvanized torque tubes for used in solar arrays, hollow structural section steel tubing, electrical conduit, fabricated concrete reinforcing steel, cold finished steel, steel fasteners, steel grating and expanded metal, wire and wire mesh, metal building systems, insulated metal panels, steel racking, overhead doors, and utility towers and structures for communications and energy transmission. This segment is also involved in the piling distribution business. The Raw Materials segment produces direct reduced iron (DRI); brokers ferrous and nonferrous metals, pig iron, hot briquetted iron, and DRI; supplies ferro-alloys; processes ferrous and nonferrous scrap metal; and engages in the natural gas production and industrial gas business. This segment sells its ferrous scrap to electric arc furnace steel mills and foundries for manufacturing process; and nonferrous scrap metal to aluminum can producers, secondary aluminum smelters, steel mills and other processors, and consumers of various nonferrous metals. It markets its products through in-house sales force; and internal distribution and trading companies. Nucor Corporation was founded in 1905 and is headquartered in Charlotte, North Carolina.

Nucor Bull Case

Here are some ways that investors could benefit from investing in Nucor Co.:

  • Nucor Co. has recently been upgraded to an "outperform" rating by BMO Capital Markets, indicating strong potential for growth and positive investor sentiment.
  • The current stock price is around $119, which reflects a recent increase, suggesting positive market performance and potential for further appreciation.
  • Analysts have set a target price of $145, indicating a potential upside of over 20% from the current price, which could attract investors looking for growth opportunities.
  • The company has a solid market capitalization of approximately $27.46 billion, showcasing its stability and presence in the basic materials sector.
  • Nucor Co. has a low debt-to-equity ratio, which suggests a strong financial position and lower risk for investors compared to companies with higher debt levels.

Nucor Bear Case

Investors should be bearish about investing in Nucor Co. for these reasons:

  • Despite recent upgrades, some analysts have lowered their price targets, indicating mixed sentiments about the stock's future performance.
  • There has been significant insider selling, with the CEO recently selling over 34,000 shares, which could raise concerns about the company's future prospects.
  • The stock has experienced volatility, with a 52-week high of $170.52 and a low of $97.59, suggesting potential risks for investors in terms of price fluctuations.
  • Some analysts have issued sell ratings, indicating that there are differing opinions on the stock's value and future performance.
  • The company's price-to-earnings ratio is relatively high, which may suggest that the stock is overvalued compared to its earnings, potentially deterring value-focused investors.
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