Nucor shares fall for a second straight session on Monday, company forecasts lower third-quarter earnings

Nucor Corp said on Monday that it now expected earnings within the range of $0.75 to $0.80 per share during the third quarter ended on September 28th. The forecast range compares with earnings of $1.26 per share during the second quarter of 2019 and earnings of $2.13 per share during the third quarter of 2018.

Nucor shares closed lower for a second consecutive trading session in New York on Monday. It has also been the steepest daily loss since September 3rd. The stock went down 0.82% ($0.44) to $53.16, after touching an intraday low at $52.50, or a price level not seen since September 12th ($52.26).

Shares of Nucor Corp have risen 2.61% so far in 2019 compared with a 19.59% gain for the benchmark index, S&P 500 (SPX).

In 2018, Nucor Corp’s stock went down 18.51%, thus, it again underperformed the S&P 500, which registered a 6.24% loss.

Results for the third quarter of 2018 reflected a non-cash impairment charge of $110 million ($0.26 per share) associated with Nucor’s proved producing natural gas well assets, the company said.

Nucor expects weaker performance in the steel mills segment during the third quarter compared to the previous three-month period mostly because of lower prices of sheet and plate steel.

On the other hand, performance in the steel products segment is projected to improve during the third quarter compared to the prior quarter due to favorable non-residential construction market conditions.

Last but not least, performance in the raw materials segment is projected to weaken during the third quarter compared to the previous three-month period, as margins in Nucor’s direct reduced iron (DRI) businesses are expected to shrink further.

Analyst stock price forecast and recommendation

According to CNN Money, the 12 analysts, offering 12-month forecasts regarding Nucor Corp’s stock price, have a median target of $60.00, with a high estimate of $79.00 and a low estimate of $46.00. The median estimate represents a 12.87% upside compared to the closing price of $53.16 on September 16th.

The same media also reported that at least 9 out of 16 surveyed investment analysts had rated Nucor Corp’s stock as “Buy”, while 6 – as “Hold”.