CHARLOTTE, N.C. - Nucor Corporation (NYSE: NYSE:NUE) reported a decline in first-quarter profits and missed Wall Street expectations, with shares falling over 6% in response to the earnings and revenue miss, coupled with a disappointing outlook for the second quarter. The steelmaker's adjusted earnings per share (EPS) came in at $3.46, below the analyst estimate of $3.67. Revenue for the quarter was $8.14 billion, also falling short of the consensus estimate of $8.26 billion.
Compared to the same period last year, Nucor's net earnings attributable to stockholders decreased from $1.14 billion, or $4.45 per diluted share, to $844.8 million, or $3.46 per diluted share. Revenue saw a 7% year-over-year (YoY) decline from $8.71 billion in the first quarter of 2023. The company's performance reflects the challenges faced in the steel market as conditions have cooled from the post-pandemic highs.
Leon Topalian, Nucor's Chair, President, and Chief Executive Officer, acknowledged the tough market conditions but highlighted the company's strategic moves, "Nucor's performance continues to be strong even as steel market conditions have come off their post-pandemic record highs," he said. "We broadened our capabilities in the rapidly growing data center market, announced new partnerships to supply our customers with low carbon steel and accelerate the development of cleaner forms of energy, and introduced the Nucor Consumer Spot Price for our hot-rolled coil products to provide our customers with more timely and transparent information."
Looking ahead, Nucor expects earnings in the second quarter of 2024 to decrease compared to the first quarter. The anticipated decline is attributed mainly to lower average selling prices in the steel mills segment, which is expected to be partially offset by modestly increased volumes. The steel products segment is also projected to see moderately decreased earnings due to lower average selling prices, despite increased volumes. However, the raw materials segment is forecasted to perform better due to the increased profitability of direct reduced iron facilities and scrap processing operations.
Nucor's financial strength remains solid, with $5.54 billion in cash and cash equivalents, short-term investments, and restricted cash and cash equivalents at the end of the first quarter. The company's credit facility remains undrawn, and its credit rating is the strongest in the North American steel sector.
Despite the setbacks, Nucor continues its commitment to returning capital to stockholders, having repurchased approximately 5.5 million shares of its common stock at an average price of $180.79 per share during the first quarter. The company's board of directors also declared a cash dividend of $0.54 per share, marking Nucor's 204th consecutive quarterly cash dividend.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.