Steel Dynamics, Inc. (NASDAQ:STLD) Stock Rated "Moderate Buy" by Sell-Side Analysts

Key Points

• Steel Dynamics has a “Moderate Buy” consensus rating from 12 analysts, with eight buys and four holds; the average 12-month price target is $257.45.
• The company’s latest quarter exceeded expectations, reporting $3.69 in EPS and $6.09 billion in revenue, up 33.4% year over year. Analysts expect about $5.40 in third-quarter EPS and $6.54 billion in revenue.
• Third-quarter earnings, scheduled for October 19, are the key near-term catalyst, though weaker-than-expected guidance and the lack of favorable earnings-surprise indicators could weigh on the stock.

Steel Dynamics, Inc. (NASDAQ:STLD - Get Free Report) has earned a consensus rating of "Moderate Buy" from the twelve analysts that are currently covering the stock, MarketBeat reports. Four investment analysts have rated the stock with a hold rating and eight have issued a buy rating on the company. The average 1-year price target among brokers that have issued ratings on the stock in the last year is $257.45.

Several equities research analysts recently issued reports on STLD shares. JPMorgan Chase & Co. reduced their price objective on shares of Steel Dynamics from $272.00 to $260.00 and set a "neutral" rating for the company in a research note on Friday. Morgan Stanley decreased their price objective on shares of Steel Dynamics from $270.00 to $260.00 and set an "equal weight" rating for the company in a report on Wednesday, July 22nd. Barclays increased their target price on shares of Steel Dynamics from $270.00 to $272.00 and gave the stock an "overweight" rating in a research report on Wednesday, July 22nd. KeyCorp restated an "overweight" rating on shares of Steel Dynamics in a report on Wednesday, July 22nd. Finally, Wall Street Zen lowered Steel Dynamics from a "strong-buy" rating to a "buy" rating in a report on Sunday, September 20th.

Key Steel Dynamics News

Here are the key news stories impacting Steel Dynamics this week:

• Positive Sentiment: Wall Street expects year-over-year earnings growth in Steel Dynamics’ third quarter, with consensus estimates calling for approximately $5.40 in earnings per share and $6.54 billion in revenue. Steel Dynamics Q3 analyst forecast changes
• Positive Sentiment: Steel Dynamics is being compared with Ternium as a potential value investment, keeping attention focused on STLD’s earnings growth, profitability and valuation relative to another steel producer. TX versus STLD value comparison
• Neutral Sentiment: Steel Dynamics is scheduled to report third-quarter earnings after the market closes on Monday, October 19. The event is likely to be the main near-term catalyst for the shares. Steel Dynamics projected earnings release
• Negative Sentiment: Zacks says STLD does not currently have the preferred combination of earnings-surprise indicators that typically signals a likely beat, increasing the risk of a disappointing reaction if results or guidance fall short. Steel Dynamics earnings expectations
• Negative Sentiment: J.P. Morgan maintained a Hold rating, while a separate report said the bank lowered its expectations for STLD’s stock price. Recent analyst forecast changes also referenced company guidance that was below expectations, adding pressure ahead of the earnings release. J.P. Morgan hold rating

Steel Dynamics Price Performance

Shares of STLD opened at $239.14 on Tuesday. The company has a debt-to-equity ratio of 0.45, a quick ratio of 1.45 and a current ratio of 3.18. The firm has a market cap of $34.28 billion, a PE ratio of 21.68, a PEG ratio of 0.43 and a beta of 1.48. The firm's 50 day moving average price is $240.79 and its 200 day moving average price is $234.71. Steel Dynamics has a twelve month low of $140.87 and a twelve month high of $288.74.

Steel Dynamics (NASDAQ:STLD - Get Free Report) last posted its earnings results on Tuesday, July 21st. The basic materials company reported $3.69 EPS for the quarter, topping the consensus estimate of $3.63 by $0.06. Steel Dynamics had a net margin of 7.83% and a return on equity of 18.12%. The company had revenue of $6.09 billion during the quarter, compared to the consensus estimate of $5.56 billion. During the same period in the previous year, the firm posted $2.01 earnings per share. The company's revenue for the quarter was up 33.4% compared to the same quarter last year. As a group, research analysts expect that Steel Dynamics will post 18.13 EPS for the current fiscal year.

Steel Dynamics Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Friday, October 9th. Stockholders of record on Wednesday, September 30th were paid a dividend of $0.53 per share. This represents a $2.12 annualized dividend and a dividend yield of 0.9%. The ex-dividend date was Wednesday, September 30th. Steel Dynamics's dividend payout ratio is 19.22%.

Institutional Inflows and Outflows

Institutional investors have recently made changes to their positions in the stock. BlackRock Inc. bought a new stake in Steel Dynamics during the second quarter worth approximately $2,844,501,000. Bank of America Corp DE bought a new position in shares of Steel Dynamics in the second quarter valued at approximately $264,212,000. Bank of New York Mellon Corp bought a new position in shares of Steel Dynamics in the second quarter valued at approximately $211,159,000. Hsbc Holdings PLC raised its position in shares of Steel Dynamics by 92.4% in the fourth quarter. Hsbc Holdings PLC now owns 1,030,448 shares of the basic materials company's stock valued at $174,609,000 after purchasing an additional 494,828 shares during the period. Finally, Deutsche Bank AG acquired a new stake in shares of Steel Dynamics in the second quarter worth $126,579,000. 82.41% of the stock is owned by institutional investors.

Steel Dynamics Company Profile

Steel Dynamics, Inc is a steel producer and metals recycler headquartered in Fort Wayne, Indiana. Founded in 1993, the company operates electric arc furnace steel mills that use recycled ferrous scrap and other raw materials to manufacture steel products for customers in construction, automotive, manufacturing, energy and other industrial markets.

Its steel operations produce flat-roll steel, long products, structural steel and rail products, along with specialized steel products such as galvanized, painted and other value-added coated materials.

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