Steel Dynamics (NASDAQ:STLD) Shares Down 8.2% - Time to Sell?

Key Points

• Steel Dynamics shares fell 8.2% to about $229.33, trading below the 50-day moving average but above the 200-day average. The decline occurred despite a consensus analyst rating of “Moderate Buy” and an average price target of $259.09.
• The company reported strong quarterly results, with earnings of $3.69 per share and revenue of $6.09 billion, beating estimates and increasing 33.4% year over year. Analysts expect full-year earnings of approximately $17.16 per share.
• Steel Dynamics declared a quarterly dividend of $0.53 per share, equivalent to a 0.9% annual yield and a 19.22% payout ratio. Institutional investors own 82.41% of the company, while an insider recently sold 10,000 shares.

Steel Dynamics, Inc. (NASDAQ:STLD - Get Free Report) was down 8.2% during trading on Wednesday . The stock traded as low as $236.46 and last traded at $229.3260. 678,336 shares changed hands during mid-day trading, a decline of 45% from the average daily volume of 1,225,574 shares. The stock had previously closed at $249.81.

Analyst Ratings Changes

Several equities research analysts have recently weighed in on STLD shares. Citigroup upped their price target on Steel Dynamics from $180.00 to $255.00 and gave the company a "buy" rating in a research report on Wednesday, April 22nd. BMO Capital Markets boosted their price objective on shares of Steel Dynamics from $195.00 to $240.00 and gave the company an "outperform" rating in a research note on Wednesday, April 22nd. Morgan Stanley decreased their target price on shares of Steel Dynamics from $270.00 to $260.00 and set an "equal weight" rating on the stock in a report on Wednesday, July 22nd. Bank of America lowered their target price on shares of Steel Dynamics from $280.00 to $260.00 and set a "neutral" rating on the stock in a research note on Thursday, July 9th. Finally, The Goldman Sachs Group assumed coverage on shares of Steel Dynamics in a report on Wednesday, July 29th. They issued a "buy" rating and a $300.00 price target for the company. Eight equities research analysts have rated the stock with a Buy rating and four have issued a Hold rating to the stock. According to MarketBeat, Steel Dynamics has an average rating of "Moderate Buy" and a consensus target price of $259.09.

Steel Dynamics Trading Down 10.5%

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 stock has a market cap of $32.04 billion, a P/E ratio of 20.39, a P/E/G ratio of 0.48 and a beta of 1.52. The stock has a 50-day moving average price of $248.10 and a 200-day moving average price of $221.61.

Steel Dynamics (NASDAQ:STLD - Get Free Report) last posted its quarterly earnings data on Tuesday, July 21st. The basic materials company reported $3.69 earnings per share 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 for the quarter, compared to analysts' expectations of $5.56 billion. During the same period in the prior year, the business earned $2.01 earnings per share. Steel Dynamics's revenue for the quarter was up 33.4% compared to the same quarter last year. On average, equities research analysts expect that Steel Dynamics, Inc. will post 17.16 EPS for the current year.

Steel Dynamics Dividend Announcement

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

Insider Buying and Selling at Steel Dynamics

In other news, SVP James Stanley Anderson sold 10,000 shares of Steel Dynamics stock in a transaction on Friday, June 5th. The shares were sold at an average price of $268.70, for a total transaction of $2,687,000.00. Following the completion of the sale, the senior vice president directly owned 102,837 shares of the company's stock, valued at approximately $27,632,301.90. The trade was a 8.86% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Company insiders own 6.60% of the company's stock.

Institutional Investors Weigh In On Steel Dynamics

A number of large investors have recently added to or reduced their stakes in the company. BlackRock Inc. bought a new position in shares of Steel Dynamics during the 2nd quarter valued at about $2,844,501,000. Capital Research Global Investors lifted its position in Steel Dynamics by 0.3% in the 4th quarter. Capital Research Global Investors now owns 3,623,054 shares of the basic materials company's stock worth $613,926,000 after buying an additional 9,959 shares during the last quarter. Life Cycle Investment Partners Ltd purchased a new stake in Steel Dynamics in the fourth quarter worth approximately $586,702,000. Norges Bank purchased a new stake in Steel Dynamics in the fourth quarter worth approximately $564,590,000. Finally, Invesco Ltd. grew its position in Steel Dynamics by 6.3% during the fourth quarter. Invesco Ltd. now owns 1,965,092 shares of the basic materials company's stock valued at $332,985,000 after acquiring an additional 116,379 shares during the last quarter. Hedge funds and other institutional investors own 82.41% of the company's stock.

About Steel Dynamics

Steel Dynamics, Inc is a U.S.-based, diversified steel producer and metals recycler that operates an integrated network of mini-mills, finishing lines and fabrication facilities. Founded in 1993 and headquartered in Fort Wayne, Indiana, the company manufactures a broad range of steel products and provides downstream processing, coating and fabrication services to industrial customers. Its operations combine steelmaking using electric-arc furnaces with extensive metals recycling capabilities, allowing Steel Dynamics to convert scrap ferrous and nonferrous materials into finished steel products.

The company's product portfolio includes flat-rolled steel (coiled and sheet products), structural steel and fabricated components, along with coated and painted steel used in consumer, industrial and construction applications.

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