Rating Change #1
Nucor Corp (NUE - Get Report) has been upgraded by TheStreet Ratings from hold to buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
Highlights from the ratings report include:
- NUCOR CORP reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. During the past fiscal year, NUCOR CORP turned its bottom line around by earning $0.42 versus -$0.95 in the prior year. This year, the market expects an improvement in earnings ($2.30 versus $0.42).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 672.6% when compared to the same quarter one year prior, rising from $23.50 million to $181.52 million.
- The revenue growth significantly trails the industry average of 73.3%. Since the same quarter one year prior, revenues rose by 26.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Despite currently having a low debt-to-equity ratio of 0.57, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that NUE's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.80 is high and demonstrates strong liquidity.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Metals & Mining industry and the overall market, NUCOR CORP's return on equity is below that of both the industry average and the S&P 500.
Nucor Corporation, together with its subsidiaries, engages in the manufacture and sale of steel and steel products in North America and internationally. It operates through three segments: Steel Mills, Steel Products, and Raw Materials. The company has a P/E ratio of 20.4, above the average metals & mining industry P/E ratio of 20.1 and above the S&P 500 P/E ratio of 17.7. Nucor has a market cap of $12.53 billion and is part of the basic materials sector and metals & mining industry. Shares are down 7.6% year to date as of the close of trading on Wednesday.You can view the full Nucor Ratings Report or get investment ideas from our investment research center. -- Reported by Kevin Baker in Jupiter, Fla.
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