5-Star Stocks Poised to Pop: Nucor

Based on the aggregated intelligence of 120,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, steelmaker Nucor (NYSE: NUE  ) has earned a coveted five-star ranking. Our data has shown that five-star stocks outperform the market by a significant margin; conversely, one-star stocks have woefully lagged the market average.

With that in mind, let's take a closer look at Nucor's business, and see what CAPS investors are saying about the stock right now.

Nucor facts

Headquarters (founded)

Charlotte, N.C. (1940)

Market Cap

$14.4 billion

Industry

Steel

Trailing-12-Month Revenue

$23.9 billion

Management

CEO Daniel DiMicco (since 2000)

CFO Terry Lisenby (since 2000)

Return on Equity (average last three years)

34.1%

Dividend Yield

3.1%

Competitors

United States Steel (NYSE: X  ) ,

AK Steel (NYSE: AKS  )

CAPS members bullish on NUE also bullish on:

Vale (NYSE: RIO  ) ,

Freeport-McMoRan Copper & Gold (NYSE: FCX  )

CAPS members bearish on NUE also bearish on:

ArcelorMittal (NYSE: MT  ) ,

General Motors (NYSE: GM  )

Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.

Over on CAPS, some 96% of the 1,535 members who have rated Nucor believe the stock will outperform the S&P 500 going forward. These bulls include DrDinoTX and CAPS All-Star MagicDiligence.

Two days ago, DrDinoTX tapped Nucor as a particularly timely pick:

Great company with outstanding management. Their low operating leverage is terrific for this tough economic environment. Plus a large cash balance gives this company acquisition possibilities.

In a pitch from last week, MagicDiligence elaborated on the Nucor bull case. Below is an excerpt, but be sure to check out the entire analysis here:

Predictably, Nucor's formula for success in a tough industry mirrors that of Dell (DELL), Southwest Airlines (LUV), and Wal-Mart (WMT) in similarly difficult markets - by consistently being the low cost provider. In Nucor's case, the low cost advantage has been achieved through consistently doing things better than competitors. ... The dollar is strengthening, making foreign steelmakers more competitive. Still, Nucor has a track record of great results, and this record is likely to continue into the future.

What do you think about Nucor, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 120,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started. 

On Jan. 12, 2009, Fool co-founder David Gardner, Jeff Fischer, and their Motley Fool Pro team will accept new subscribers to their real-money portfolio service. Motley Fool Pro is investing $1 million of the Fool's own money in long and short positions in a range of securities, including common stocks, put and call options, and exchange-traded funds. They also incorporate proprietary CAPS "community intelligence" data into their research. To learn more about Motley Fool Pro and to receive a private invitation to join, simply enter your email address in the box below.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Wal-Mart and Dell are Motley Fool Inside Value picks. The Fool's disclosure policy always gets a perfect score.


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