Please ensure Javascript is enabled for purposes of website accessibility

Steelmaker Nucor Sees Increased Earnings, but Rising COVID-19 Impacts

By Howard Smith - Mar 19, 2020 at 10:49AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Nucor provided earnings guidance for the first quarter, and the outlook for increasing coronavirus impacts.

Nucor Corp. (NUE -3.26%), America's largest recycler and most diversified steel and steel products company, today released guidance for this quarter, ending April 4, 2020. The company sees earnings of $0.95-$1.00 per diluted share with the company so far having minimal impacts from the COVID-19 outbreak.

The earnings results would be an increase versus the $0.35 per diluted share it reported in the fourth quarter of 2019, and a decrease compared to $1.63 per diluted share it earned in the year ago quarter.

Hot Rolled steel coil being wrapped on a mandrel

Image source: Getty Images.

Increasing coronavirus impacts probable

Results in the range of the first quarter guidance would surpass analyst consensus estimates of $0.87 per share. The company said that its steel mills segment is performing well, with strong order rates, backlog, and utilization rates well into March. It said the current business strength is due to "strong underlying demand in nonresidential construction and other end-use markets."

It also noted that impacts related to COVID-19 on its supply chain and operations have been minimal to date. However, the company sees more severe impacts being probable. Although it is too early to predict the nature of what future impacts will be on the business, it does see them increasing "as economic activity is disrupted by construction sites being shut down in some major cities and other business interruptions."

This view mirrors that of competitor Steel Dynamics, Inc. (STLD 1.32%), which also guided yesterday that although order activity has remained strong and steady, it expects recent pandemic-related temporary closures to have a negative impact in the coming weeks. 

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Nucor Corporation Stock Quote
Nucor Corporation
NUE
$119.75 (-3.26%) $-4.04
Steel Dynamics, Inc. Stock Quote
Steel Dynamics, Inc.
STLD
$75.11 (1.32%) $0.98

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
345%
 
S&P 500 Returns
119%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/17/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.