Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Nucor expects high quarterly earnings in Q1 2021, beating its former record from Q3 2008, on healthy demand for its products from end-markets such as automotive, nonresidential construction, renewable energy, heavy equipment, and agriculture.


The steel producer expects March to be its strongest month in Q1 with earnings estimated in the range of $3-3.10 per diluted share for the quarter ending April 3, 2021, the company said in a news release on Tuesday. The new outlook lifts the company’s earnings from $0.07 per share in Q1 2020 and $1.30 per share in Q4 2020. 


At the year’s onset, Nucor indicated its margins began consistent growth, and this course is likely to remain strong into the second quarter. Moreover, Q2 earnings are apt to set another quarterly earnings record, the company indicated, amid solid results from its three divisions. 


The company’s Q1 2021 results in the steel mills and raw materials section are projected to be drastically above the preceding quarter due to the dual factors of strong steel demand and elevated pricing. All product segments within the steel mills division are estimating greater results in the first quarter against Q4 2020 results, with the greatest expansion taking place in Nucor’s sheet and plate mills. 


Nucor anticipates strong cash flow from operations will allow the company to end the quarter with over $4.5bn in financial liquidity, including its $1.5bn undrawn revolving credit facility.


Earnings in Q4 2020 comprised of non-cash impairment charges of $130mn, net benefits of $48mn, $39.7mn related to certain tax items, and a net benefit of $17.9mn stemming from the final transaction for the company’s Duferdofin Nucor S.r.l. investment. Results in Q1 2020 include losses on assets of $287.8mn related to the company’s earlier held equity method for the Duferdofin Nucor S.r.l. investment.

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