Nucor's stock falls after steelmaker issues profit warning, citing lower selling prices

By Tomi Kilgore

Steel-mill, steel-products and raw-materials businesses all expected to see third-quarter earnings below second-quarter levels

Shares of Nucor Corp. slumped in early Tuesday trading after the steelmaker warned investors of a third-quarter profit shortfall, as lower selling prices weighed on its steel-mill business.

The company expects third-quarter net earnings per share to be 87 cents to 97 cents. Excluding nonrecurring items, such as a one-time asset-impairment charge, adjusted EPS is expected to be $1.30 to $1.40.

That's down from EPS of $2.68 in the second quarter and $4.57 in the same period a year ago, and well below the current FactSet consensus of $1.81.

The stock (NUE) dropped 2.1% in premarket trading.

The selloff comes after the stock had already plunged 28.9%, through Monday, since closing at a record $200.97 on April 5. Over the same period, the S&P 500 SPX has gained 8.2%.

Besides the weakness in the steel-mill segment, the company also expects third-quarter earnings from the steel-products segment to be below second-quarter levels, "due to lower average selling prices and lower volumes."

When the company provided guidance in July, it said the segment's earnings would decline "due to lower average selling prices."

The company also expects third-quarter raw-materials earnings to fall from second-quarter levels.

The company said it will release full third-quarter results on Oct. 21 after the closing bell.

The steel business has been in the news recently, with President Joe Biden opposing Japan's Nippon Steel Corp.'s (NPSCY) (JP:5401) proposed purchase of Nucor rival U.S. Steel Corp. (X) due to national-security concerns.

Amid Biden's opposition and continued weakness in the steel market, U.S. Steel's stock on Monday closed 26.7% below the 13-year closing high of $49.59 seen on Dec. 13, 2023.

-Tomi Kilgore

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09-17-24 0928ET

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