Nucor Posts Strong Q3 Results; Shares Fall 3%

Steel manufacturing company Nucor Corporation (NUE) has reported better-than-expected results for the third quarter of 2021. The robust results were primarily driven by significant growth witnessed in net sales.

However, following the earnings release, shares of the company declined 2.9% on Thursday. The stock added to its losses slightly to close at $101.50 in extended trade.

Nucor reported quarterly net sales of $10.31 billion, up 109% year-over-year. Moreover, the figure surpassed the consensus estimate of $10.15 billion. The growth in sales can be attributed primarily to an 86% year-over-year increase witnessed in average sales price per ton.

The company reported quarterly earnings of $7.28 per share, topping the Street’s estimate of $7.03 per share. Nucor had reported earnings of $0.63 per share in the same quarter last year.

Notably, the company said that it had $2.29 billion in cash and cash equivalents, short-term investments and restricted cash, and cash equivalents in hand, along with access to a revolving credit facility of $1.50 billion.

The CEO of Nucor, Leon Topalian, said, “During the third quarter, we once again achieved record results, with earnings per share of $7.28. Our third quarter performance surpassed our previous record of $5.04 set in the second quarter of this year and almost matched our full year earnings record of $7.42 that we set back in 2018.” (See Nucor stock chart on TipRanks)

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Recently, Morgan Stanley analyst Carlos De Alba reiterated a Hold rating on the stock. The analyst, however, lowered the price target from $115 to $105, which implies upside potential of 2.9% from current levels.

The Wall Street community is cautiously optimistic about the stock and has a Moderate Buy consensus rating based on 3 Buys and 3 Holds. The average Nucor price target of $125.83 implies that the stock has upside potential of 23.3% from current levels.

Nucor scores a 9 out of 10 from TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained about 104.5% over the past year.

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