First Read: Nucor Corp "London NDR takeaways" (Neutral) Jones

研报英文原文证据摘录

First Read: Nucor Corp "London NDR takeaways" (Neutral) Jones

Forecast returns

Forecast price appreciation -7.8%

Forecast dividend yield 0.9%

Forecast stock return -6.9%

Market return assumption 9.2%

Forecast excess return -16.1%

Company Description

Nucor operates primarily in North America and is the largest steel recycler in North America.

The Steel Mills Segment produces sheet steel (hot-rolled, cold-rolled, and galvanized), tubular,

plate, structural (beams and pilings), and bar steel (rebar and wire rod). The Steel Products

segment produces a variety of joists, decking, fasteners, and other products largely used in

non-residential construction.

Valuation Method and Risk Statement

The US Materials sector is subject to relatively high volatility and several risk factors. These

include but are not limited to commodity price volatility; regulatory changes; production

disruptions; labor issues; equipment delays; unfavorable weather and more. US steel

companies are throughput businesses exposed fundamentally to commodity price risks on

both the input (raw materials) and output (customer pricing) sides of their businesses. Higher

raw material prices could reduce margins if not reciprocated by higher customer prices, which

are sometimes realized with a lag to spot pricing due to delivery contracts. Most steel

produced in the US is consumed domestically by automobile manufacturing, construction,

and machinery manufacturing end markets. These markets are generally driven by GDP

growth and industrial production. Further, overcapacity exists in the steel market globally, and

US steel prices can at times come under downward pressure from lower cost foreign imports,

particularly from China. Overall demand has been flat for the last twenty years, with some ups