Steel Dynamics, Inc.
) has projected second-quarter 2013 earnings in the range of 10
cents to 14 cents per share. Estimated earnings are lower than
the company's year-ago quarter's earnings of 20 cents per share
as well as first quarter's earnings of 21 cents per share.
Steel Dynamics expects overall steel shipments for the second
quarter to be modestly higher sequentially as increased sheet and
other long product shipments, including engineered
special-bar-quality products and standard railroad rail, is
expected to more than offset a decline in merchant bar volume.
However, volume improvement is expected to be offset by
contraction in margins, resulting in lower profits from steel
operations. Lower average consecutive quarterly sheet and
structural steel pricing will contract margins.
Steel Dynamics expects its metals recycling operation's financial
results to decline slightly in the second quarter on a sequential
basis, as projected increases in both ferrous shipments and
margins will be more than offset by lower nonferrous volumes and
Fabrication segment is anticipated to earn profits for the fifth
consecutive quarter, supported by improvement in the
non-residential construction activity.
Steel Dynamics believes that its performance will be positively
impacted by strong residential construction market, automotive
and manufacturing markets and improvements in the non-residential
construction demand. However, there is an apprehension that Steel
Dynamics may be negatively impacted by economic uncertainty in
China and Europe, which affects customer confidence and buying
Steel Dynamics released its first-quarter 2013 results on Apr 17.
The company reported earnings (excluding positive tax
adjustments) of 21 cents per share in the first quarter,
marginally exceeding the Zacks Consensus Estimate and year over
year earnings of 20 cents. Profit for the quarter increased to
$48.2 million from $45.6 million in the prior-year quarter.
Revenues decreased 9.4% year over year to $1,796 million in
the first quarter, but surpassed the Zacks Consensus Estimate of
Steel Dynamics expects continued demand in the automotive market
and sees higher potential in manufactured goods and residential
construction sectors in 2013. However, it is not overtly
optimistic about the non-residential construction market in
Steel Dynamics currently carries a Zacks Rank #3 (Hold).
Other companies in the steel industry with favorable Zacks
Kobe Steel Ltd.
Shiloh Industries Inc.
Angang Steel Company Limited
). While both Kobe Steel and Shiloh Industries hold a Zacks Rank
#1 (Strong Buy), Angang Steel retains a Zacks Rank #2 (Buy).
ANGANG STEEL LT (ANGGY): Get Free Report
KOBE STEEL-ADR (KBSTY): Get Free Report
SHILOH INDS INC (SHLO): Get Free Report
STEEL DYNAMICS (STLD): Free Stock Analysis
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