Steel Dynamics (NASDAQ:STLD) Stock Price Expected to Rise, Barclays Analyst Says

Key Points

• Barclays raised its price target on Steel Dynamics from $280 to $300 and maintained an “overweight” rating, implying 26.09% potential upside from the cited share price.
• Analyst sentiment is broadly positive: nine analysts rate the stock “Buy” and four “Hold,” with an average price target of $276.83.
• Steel Dynamics reported quarterly EPS of $5.26, below the $5.48 consensus, while revenue rose 34.8% year over year; its board also authorized a $3 billion share buyback.

Steel Dynamics (NASDAQ:STLD - Get Free Report) had its price objective boosted by investment analysts at Barclays from $280.00 to $300.00 in a research note issued to investors on Thursday, Benzinga reports. The firm currently has an "overweight" rating on the basic materials company's stock. Barclays's price objective points to a potential upside of 26.09% from the stock's current price.

A number of other equities analysts have also weighed in on the stock. Morgan Stanley dropped their price target on shares of Steel Dynamics from $270.00 to $260.00 and set an "equal weight" rating for the company in a research report on Wednesday, July 22nd. KeyCorp upped their price target on Steel Dynamics from $262.00 to $265.00 and gave the stock an "overweight" rating in a research note on Friday, October 23rd. The Goldman Sachs Group reaffirmed a "buy" rating and set a $299.00 price objective (down from $301.00) on shares of Steel Dynamics in a report on Tuesday, October 20th. Weiss Ratings raised Steel Dynamics from a "buy (b-)" rating to a "buy (b)" rating in a report on Wednesday, October 28th. Finally, Wall Street Zen downgraded Steel Dynamics from a "strong-buy" rating to a "buy" rating in a research report on Sunday, September 20th. Nine equities research analysts have rated the stock with a Buy rating and four have given a Hold rating to the company. Based on data from MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $276.83.

Steel Dynamics Price Performance

STLD stock traded down $1.06 during midday trading on Thursday, reaching $237.93. The company had a trading volume of 171,286 shares, compared to its average volume of 1,182,051. The firm has a 50-day moving average price of $238.40 and a 200-day moving average price of $225.71. The company has a market capitalization of $33.84 billion, a P/E ratio of 17.59, a P/E/G ratio of 0.34 and a beta of 1.45. Steel Dynamics has a 1 year low of $151.21 and a 1 year high of $288.74. The company has a debt-to-equity ratio of 0.43, a current ratio of 3.14 and a quick ratio of 1.48.

Steel Dynamics (NASDAQ:STLD - Get Free Report) last released its earnings results on Tuesday, October 20th. The basic materials company reported $5.26 earnings per share for the quarter, missing analysts' consensus estimates of $5.48 by ($0.22). The firm had revenue of $6.51 billion during the quarter, compared to the consensus estimate of $6.43 billion. Steel Dynamics had a return on equity of 21.57% and a net margin of 8.82%. The business's quarterly revenue was up 34.8% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $2.74 EPS. On average, research analysts anticipate that Steel Dynamics will post 18.12 earnings per share for the current fiscal year.

Steel Dynamics declared that its board has initiated a share buyback plan on Monday, November 9th that allows the company to repurchase $3 billion in outstanding shares. This buyback authorization allows the basic materials company to buy up to 8.8% of its stock through open market purchases. Stock buyback plans are typically a sign that the company's board of directors believes its shares are undervalued.

Insiders Place Their Bets

In related news, EVP Barry Schneider sold 50,000 shares of Steel Dynamics stock in a transaction dated Tuesday, November 3rd. The shares were sold at an average price of $248.91, for a total transaction of $12,445,500.00. Following the completion of the sale, the executive vice president owned 196,399 shares in the company, valued at $48,885,675.09. This trade represents a 20.29% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through the SEC website. 6.60% of the stock is owned by insiders.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in STLD. Baird Financial Group Inc. grew its holdings in Steel Dynamics by 9.9% during the second quarter. Baird Financial Group Inc. now owns 187,906 shares of the basic materials company's stock worth $43,117,000 after acquiring an additional 16,930 shares during the period. Sapient Capital LLC lifted its holdings in Steel Dynamics by 34.6% in the second quarter. Sapient Capital LLC now owns 447,664 shares of the basic materials company's stock valued at $102,958,000 after acquiring an additional 115,080 shares during the period. BlackRock Inc. purchased a new stake in Steel Dynamics in the 2nd quarter worth approximately $2,844,501,000. Public Employees Retirement System of Ohio acquired a new position in shares of Steel Dynamics in the 2nd quarter valued at $10,169,000. Finally, Nykredit A S purchased a new stake in Steel Dynamics during the second quarter worth $8,596,000. 82.41% of the stock is currently owned by institutional investors.

Steel Dynamics Company Profile

Steel Dynamics, Inc. is a U.S.-based steel producer and metals recycler founded in 1993. The company operates electric-arc-furnace steel mills and produces flat-rolled, structural, engineered bar, merchant bar and rail products for customers across a range of industries. Its businesses also include metals recycling, steel fabrication and aluminum operations. Through these activities, Steel Dynamics collects and processes scrap metal, manufactures steel components and supplies products used in construction, automotive manufacturing, energy and other markets.

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