Nucor Announces Guidance for the Second Quarter of 2024 Earnings
Nucor (NYSE: NUE) has issued guidance for Q2 2024, projecting earnings between $2.20 and $2.30 per diluted share. This is a decline from $3.46 in Q1 2024 and $5.81 in Q2 2023. The primary cause is reduced earnings from the steel mills segment due to lower selling prices and volumes. The steel products segment also expects reduced earnings from lower selling prices, partially offset by higher volumes. However, raw materials segment earnings are expected to rise due to increased profitability in direct reduced iron facilities. During Q2, Nucor repurchased 2.9M shares at an average of $170.70 each, totaling 8.5M shares year-to-date at $177.30. The company returned over $1.76B to stockholders through share repurchases and dividends. Nucor will release its full Q2 earnings after markets close on July 22, 2024, followed by a conference call on July 23, 2024.
- Nucor expects Q2 2024 earnings to range between $2.20 and $2.30 per diluted share.
- Raw materials segment earnings are projected to increase compared to Q1 2024.
- Nucor repurchased 2.9M shares in Q2 at an average price of $170.70.
- Year-to-date, Nucor repurchased 8.5M shares at an average price of $177.30.
- The company returned over $1.76 billion to stockholders via share repurchases and dividends.
- Q2 2024 earnings are expected to decline from $3.46 in Q1 2024 and $5.81 in Q2 2023.
- Steel mills segment earnings are projected to decrease due to lower selling prices and volumes.
- Steel products segment earnings are expected to drop due to lower selling prices, despite increased volumes.
Insights
Nucor's guidance for the second quarter of 2024 indicates a projected decrease in earnings, with expectations set between
From an investor's perspective, this guidance signals caution. Lower selling prices suggest decreased demand or increased competition, which could pressure margins. Additionally, while the raw materials segment shows some positive movement with increased profitability in direct reduced iron facilities, it might not be enough to offset the downturn in the core steel mills and steel products segments.
The share repurchase activity, with 2.9 million shares bought back at an average price of
For retail investors, the key takeaway here is to carefully monitor the upcoming earnings release on July 22, 2024 and the subsequent conference call. It will provide more detailed insights into the company's strategies and expectations moving forward.
The anticipated earnings decline highlights a critical trend: lower average selling prices across Nucor's steel mills and steel products segments. This suggests either a softening in demand or heightened competitive pressures within the steel industry. Understanding these market dynamics is essential for investors, as they could lead to prolonged pricing pressure and reduced profitability for Nucor and its peers.
It is also noteworthy that Nucor's raw materials segment is expected to perform better, thanks to increased profitability from direct reduced iron facilities. This segment's positive outlook may offer some buffer against the overall earnings decline, but it underscores the importance of diversifying revenue streams within the industry.
Given Nucor's strong position as North America's largest recycler, the broader trends in recycling and sustainability initiatives could play a role in future performance. However, the immediate concern for investors is the apparent volatility in Nucor's core segments.
Investors should also consider the implications of share repurchase programs—which often signal management's confidence in the company’s longer-term prospects even if the near-term outlook appears challenging.
The largest driver for the expected decrease in earnings in the second quarter of 2024 as compared to the first quarter of 2024 is the decreased earnings of the steel mills segment, due primarily to lower average selling prices, and, to a lesser extent, lower volumes. The steel products segment is expected to have decreased earnings in the second quarter of 2024 as compared to the first quarter of 2024 due to lower average selling prices, partially offset by increased volumes. Earnings in the raw materials segment are expected to be higher in the second quarter of 2024 as compared to the first quarter of 2024 due to the increased profitability of our direct reduced iron facilities.
During the second quarter, Nucor has repurchased approximately 2.9 million shares at an average price of
Second Quarter of 2024 Earnings Release and Conference Call
Nucor will release its earnings after the markets close on Monday, July 22, 2024, and will host a conference call the morning of Tuesday, July 23, 2024 at 10:00 a.m. Eastern Time to review the Company's second quarter results. The event will be broadcast on the internet, and instructions on how to access will be sent closer to the call.
About Nucor
Nucor and its affiliates are manufacturers of steel and steel products, with operating facilities in
Forward-Looking Statements
Certain statements contained in this news release are "forward-looking statements" that involve risks and uncertainties which we expect will or may occur in the future and may impact our business, financial condition and results of operations. The words "anticipate," "believe," "expect," "intend," "project," "may," "will," "should," "could" and similar expressions are intended to identify those forward-looking statements. These forward-looking statements reflect the Company's best judgment based on current information, and, although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the projected results and expectations discussed in this news release. Factors that might cause the Company's actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) competitive pressure on sales and pricing, including pressure from imports and substitute materials; (2) U.S. and foreign trade policies affecting steel imports or exports; (3) the sensitivity of the results of our operations to general market conditions, and in particular, prevailing market steel prices and changes in the supply and cost of raw materials, including pig iron, iron ore and scrap steel; (4) the availability and cost of electricity and natural gas, which could negatively affect our cost of steel production or result in a delay or cancellation of existing or future drilling within our natural gas drilling programs; (5) critical equipment failures and business interruptions; (6) market demand for steel products, which, in the case of many of our products, is driven by the level of nonresidential construction activity in the United States; (7) impairment in the recorded value of inventory, equity investments, fixed assets, goodwill or other long-lived assets; (8) uncertainties and volatility surrounding the global economy, including excess world capacity for steel production, inflation and interest rate changes; (9) fluctuations in currency conversion rates; (10) significant changes in laws or government regulations affecting environmental compliance, including legislation and regulations that result in greater regulation of greenhouse gas emissions that could increase our energy costs, capital expenditures and operating costs or cause one or more of our permits to be revoked or make it more difficult to obtain permit modifications; (11) the cyclical nature of the steel industry; (12) capital investments and their impact on our performance; (13) our safety performance; (14) our ability to integrate businesses we acquire; and (15) any pandemic or public health situation. These and other factors are discussed in Nucor's regulatory filings with the United States Securities and Exchange Commission, including those in "Item 1A. Risk Factors" of Nucor's Annual Report on Form 10-K for the year ended December 31, 2023. The forward-looking statements contained in this news release speak only as of this date, and Nucor does not assume any obligation to update them, except as may be required by applicable law.
View original content:https://www.prnewswire.com/news-releases/nucor-announces-guidance-for-the-second-quarter-of-2024-earnings-302172678.html
SOURCE Nucor Corporation
FAQ
What is Nucor's earnings guidance for Q2 2024?
How did Nucor's Q2 2024 earnings guidance compare to previous quarters?
Why are Nucor's steel mills segment earnings expected to decrease in Q2 2024?
How many shares did Nucor repurchase in Q2 2024?
What was the average price of Nucor's share repurchases in Q2 2024?
How much has Nucor returned to stockholders year-to-date in 2024?
