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Our buy rating for Nucor has not changed since March 2004. For the first quarter of 2008, revenue rose 32% year over year to $4.97 billion. This increase was attributed to a 15% increase in average steel sales price per ton, an 11% increase in average steel products sales price per ton, and a significant increase in steel products shipments driven by acquisitions made in 2007. These factors and a strong global demand for steel also contributed to a 7.5% increase in first-quarter net income, less than the rise in revenue due to higher scrap steel costs.

Earnings per share rose as well due to Nucor's fiscal 2007 stock repurchases, which reduced the number of outstanding shares. The company continued its acquisition strategy in the first quarter, acquiring scrap processor David J. Joseph Company in February 2008. Nucor also recently bought Galamba Metals Group, which operates 16 scrap-processing facilities, and Metal Recycling Services. Finally, the company increased its base quarterly cash divided from 30 cents to 32 cents a share and approved the payment of a supplemental dividend of 20 cents a share.

According to the International Iron and Steel Institute, the global demand for steel is expected to rise 6.8% in 2008, and this positive industry trend should benefit Nucor. Looking forward to the second quarter of 2008, Nucor anticipates earnings in the range of $1.55 to $1.60 a share. Bear in mind, however, that any increases in scrap steel costs could negatively impact the company's margins and profitability, as could weak demand from the automotive and housing sectors.

Our quantitative rating is based on a variety of historical fundamental and pricing data and represents our opinion of a stock's risk-adjusted performance relative to other stocks.

However, the rating does not incorporate all of the factors that can alter a stock's performance. For example, it doesn't always factor in recent corporate or industry events that could impact the stock price, nor does it include recent technology developments and competitive dynamics that may affect the company.

For those reasons, we believe a rating alone cannot tell the whole story, and should be part of an investor's overall research.