Nucor (NUE) Up 7.5% Since Last Earnings Report: Can It Continue?

Core Viewpoint - Nucor's recent earnings report shows a decline in earnings and revenues year-over-year, but the company has outperformed the S&P 500 in the past month, raising questions about future performance leading up to the next earnings release [1][2]. Financial Performance - Nucor reported earnings of $1.22 per share for Q4 2024, down from$3.16 in the same quarter last year, but exceeded the Zacks Consensus Estimate of 64 cents [2]. - Net sales for Q4 2024 were approximately $7.1 billion, an 8.2$6.6 billion [2]. - For the full year 2024, Nucor's net earnings were $2.03 billion or$8.46 per share, compared to $4.52 billion or$18 per share in 2023 [6]. Operating Metrics - Total sales tons to outside customers for steel mills in Q4 were 4,580,000 tons, a 4% increase year-over-year, exceeding estimates of 4,202,000 tons [3]. - The overall operating rate for steel mills was 74% in Q4 2024, consistent with Q4 2023 and slightly down from 75% in Q3 2024 [3]. Segment Performance - Earnings from the steel mills unit fell 71% year-over-year due to lower average selling prices and volumes [4]. - The steel products segment saw a 49.8% decline in earnings year-over-year, attributed to lower volumes and average selling prices [4]. - The raw materials segment reported earnings of $57 million, a significant improvement from a loss of$14 million a year ago [4]. Financial Position - At the end of Q4 2024, Nucor had cash and cash equivalents and short-term investments totaling $4.14 billion, with an undrawn$1.75 billion revolving credit facility set to expire in November 2026 [5]. Future Outlook - Nucor anticipates that earnings in the steel mills and steel products segments for Q1 2025 will be comparable to Q4 2024, while earnings in the raw materials segment are expected to decline [7]. - The company expects higher corporate, administrative, and tax impacts in Q1 2025 compared to Q4 2024, which may lead to lower net earnings overall [7]. Industry Comparison - Nucor is part of the Zacks Steel - Producers industry, where Steel Dynamics, a competitor, reported a revenue decline of 8.5% year-over-year in its latest quarter [11]. - Steel Dynamics is expected to post earnings of $1.64 per share for the current quarter, reflecting a 55.3% decrease from the previous year [12].