Nucor Corporation NUE logged net earnings of $1,255.7 million or $4.89 per share in fourth-quarter 2022, down from net earnings of $2,250.4 million or $7.97 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $4.18.
The company recorded net sales of $8,723.9 million, down around 17% year over year. The figure beat the Zacks Consensus Estimate of $7,910.3 million.
Nucor Corporation Price, Consensus and EPS Surprise
Nucor Corporation price-consensus-eps-surprise-chart | Nucor Corporation Quote
Total steel mills shipments in the fourth quarter were 5,110,000 tons, down 13% year over year. Total tons shipped to outside customers were down 11% year over year to 5,738,000 tons. Average sales price fell 6% year over year and were also down 7% sequentially.
Steel mill operating rates were 70% in the quarter, down from 89% in the year-ago quarter.
Earnings of the company’s steel mills unit declined on a sequential comparison basis in the reported quarter, hurt by margin contraction, reduced selling prices and lower shipping volumes. The biggest decline in profitability was witnessed at the company’s sheet mills.
Earnings in the steel products unit were modestly lower sequentially in the fourth quarter due to reduced volumes and selling prices.
Earnings in the raw materials unit were down significantly in the fourth quarter on lower profitability of the company’s direct reduced iron facilities due to outages, reduced selling prices for raw materials, and the write-off of the leasehold interest in unproved oil and gas properties.
Earnings or full-year 2022 were $28.79 per share, up from $23.16 per share a year ago. Revenues were $41,512.5 million for the full year, up around 14% year over year.
At the end of 2022, cash and cash equivalents rose roughly 81% year over year to $4,280.9 million. Long-term debt was $6,613.7 million, up around 33% year over year.
The company repurchased roughly 3.1 million shares of its common stock during the fourth quarter.
Moving ahead, the company envisions operating income from its three business segments to rise sequentially in the first quarter of 2023. However, it sees consolidated net earnings to declined sequentially in the first quarter due to intercompany eliminations in the quarter and the absence of state tax benefits that it registered in fourth-quarter 2022.
Nucor expects earnings in the steel mills segment to be higher sequentially in the first quarter due to higher margins and volumes, with the biggest rise in profitability expected at its sheet mills.
The steel products segment’s overall profitability is projected to be higher sequentially in the first quarter. The company also sees raw materials segment earnings to rise in the first quarter due to increased volumes at DRI facilities and scrap recycling and brokerage operations.
Shares of Nucor have gained 61.9% over a year compared with the industry’s 25.2% rise.
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Zacks Rank & Other Key Picks
Nucor currently carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks worth considering in the basic materials space include Steel Dynamics, Inc. STLD, Commercial Metals Company CMC and Agnico Eagle Mines Limited AEM.
Steel Dynamics currently sports a Zacks Rank #1. The Zacks Consensus Estimate for STLD's current-year earnings has been revised 0.4% upward in the past 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 6.2%, on average. STLD has rallied around 103% in a year.
Commercial Metals currently carries a Zacks Rank #1. The consensus estimate for CMC's current-year earnings has been revised 9.8% upward in the past 60 days.
Commercial Metals’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 16.7%, on average. CMC has gained around 60% in a year.
Agnico Eagle currently carries a Zacks Rank #1. The Zacks Consensus Estimate for AEM’s current-year earnings has been revised 0.4% upward in the past 60 days.
Agnico Eagle beat Zacks Consensus Estimate in three of the last four quarters. It delivered a trailing four-quarter earnings surprise of 26.4% on average. AEM’s shares have gained 24% in the past year.
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