Steel Dynamics (STLD) rises as market takes a dip: Key facts

In the latest trading session, Steel Dynamics (STLD) closed at $172.74, marking a +2.13% move from the previous day. The stock exceeded the S&P 500, which registered a loss of 1.16% for the day. Meanwhile, the Dow lost 0.47%, and the Nasdaq, a tech-heavy index, lost 1.81%.

Shares of the steel producer and metals recycler witnessed a gain of 9.39% over the previous month, beating the performance of the Basic Materials sector with its gain of 5.81%, and the S&P 500’s gain of 1.03%.

The upcoming earnings release of Steel Dynamics will be of great interest to investors. The company is forecasted to report an EPS of $2.22, showcasing a 63.24% upward movement from the corresponding quarter of the prior year. Alongside, our most recent consensus estimate is anticipating revenue of $4.62 billion, indicating a 19.42% upward movement from the same quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.4 per share and revenue of $18.39 billion, indicating changes of -14.63% and +4.82%, respectively, compared to the previous year.

Any recent changes to analyst estimates for Steel Dynamics should also be noted by investors. Such recent modifications usually signify the changing landscape of near-term business trends. Therefore, positive revisions in estimates convey analysts’ confidence in the business performance and profit potential.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To take advantage of this, we’ve established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.94% downward. Steel Dynamics is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, Steel Dynamics is currently trading at a Forward P/E ratio of 20.13. This expresses a premium compared to the average Forward P/E of 13.85 of its industry.

We can also see that STLD currently has a PEG ratio of 1.13. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Steel – Producers industry had an average PEG ratio of 0.76 as trading concluded yesterday.

The Steel – Producers industry is part of the Basic Materials sector. Currently, this industry holds a Zacks Industry Rank of 150, positioning it in the bottom 40% of all 250+ industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow STLD in the coming trading sessions, be sure to utilize Zacks.com.