In the latest close session, Steel Dynamics (STLD) was down 1.45% at $129.02. The stock trailed the S&P 500, which registered a daily loss of 0.69%. At the same time, the Dow lost 0.55%, and the tech-heavy Nasdaq lost 0.82%.
Prior to today's trading, shares of the steel producer and metals recycler had gained 7.88% lagged the Basic Materials sector's gain of 9.38% and outpaced the S&P 500's gain of 3.79%.
The investment community will be paying close attention to the earnings performance of Steel Dynamics in its upcoming release. In that report, analysts expect Steel Dynamics to post earnings of $2.71 per share. This would mark year-over-year growth of 32.2%. Meanwhile, the latest consensus estimate predicts the revenue to be $4.71 billion, indicating a 8.52% increase compared to the same quarter of the previous year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $9.33 per share and revenue of $18.37 billion, indicating changes of -5.18% and +4.71%, respectively, compared to the previous year.
Investors should also pay attention to any latest changes in analyst estimates for Steel Dynamics. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.14% higher. Steel Dynamics is currently sporting a Zacks Rank of #3 (Hold).
In terms of valuation, Steel Dynamics is presently being traded at a Forward P/E ratio of 14.03. This denotes a premium relative to the industry average Forward P/E of 12.64.
It's also important to note that STLD currently trades at a PEG ratio of 1.06. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Steel – Producers stocks are, on average, holding a PEG ratio of 0.74 based on yesterday's closing prices.
The Steel – Producers industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 200, putting it in the bottom 20% of all 250+ industries.
