Exploring Steel Dynamics's Earnings Expectations

Steel Dynamics (NASDAQ:STLD) is set to give its latest quarterly earnings report on Wednesday, 2024-10-16. Here's what investors need to know before the announcement.

Analysts estimate that Steel Dynamics will report an earnings per share (EPS) of $2.06.

Steel Dynamics bulls will hope to hear the company announce they've not only beaten that estimate, but also to provide positive guidance, or forecasted growth, for the next quarter.

New investors should note that it is sometimes not an earnings beat or miss that most affects the price of a stock, but the guidance (or forecast).

Past Earnings Performance

In the previous earnings release, the company beat EPS by $0.05, leading to a 0.72% drop in the share price the following trading session.

Here's a look at Steel Dynamics's past performance and the resulting price change:

Quarter	Q2 2024	Q1 2024	Q4 2023	Q3 2023
EPS Estimate	2.67	3.51	2.66	3.48
EPS Actual	2.72	3.67	2.61	3.47
Price Change %	-1.0%	-3.0%	0.0%	-4.0%

Market Performance of Steel Dynamics's Stock

Shares of Steel Dynamics were trading at $130.18 as of October 14. Over the last 52-week period, shares are up 25.68%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Insights Shared by Analysts on Steel Dynamics

For investors, grasping market sentiments and expectations in the industry is vital. This analysis explores the latest insights regarding Steel Dynamics.

Analysts have given Steel Dynamics a total of 8 ratings, with the consensus rating being Neutral. The average one-year price target is $135.75, indicating a potential 4.28% upside.

Comparing Ratings with Peers

This comparison focuses on the analyst ratings and average 1-year price targets of Reliance, United States Steel and Carpenter Tech, three major players in the industry, shedding light on their relative performance expectations and market positioning.

• For Reliance, analysts project an Outperform trajectory, with an average 1-year price target of $325.0, indicating a potential 149.65% upside.
• The consensus among analysts is an Buy trajectory for United States Steel, with an average 1-year price target of $42.64, indicating a potential 67.25% downside.
• As per analysts' assessments, Carpenter Tech is favoring an Buy trajectory, with an average 1-year price target of $170.0, suggesting a potential 30.59% upside.

Summary of Peers Analysis

In the peer analysis summary, key metrics for Reliance, United States Steel and Carpenter Tech are highlighted, providing an understanding of their respective standings within the industry and offering insights into their market positions and comparative performance.

Company	Consensus	Revenue Growth	Gross Profit	Return on Equity
Steel Dynamics	Neutral	-8.84%	$774.84M	4.70%
Reliance	Outperform	-6.11%	$1.09B	3.44%
United States Steel	Buy	-17.77%	$489M	1.62%
Carpenter Tech	Buy	5.33%	$190.60M	5.97%

Key Takeaway:

Steel Dynamics ranks at the top for Gross Profit and Return on Equity among its peers. It is in the middle for Revenue Growth.

Unveiling the Story Behind Steel Dynamics

Steel Dynamics Inc operates scrap-based steel minimills with roughly 16 million tons of annual steel production capacity. The company's segment includes steel operations, metals recycling operations, steel fabrication operations, Aluminum Operations Segment, and others. It generates maximum revenue from the steel operations segment.

Understanding the Numbers: Steel Dynamics's Finances

Market Capitalization Analysis: With an elevated market capitalization, the company stands out above industry averages, showcasing substantial size and market acknowledgment.

Revenue Growth: Steel Dynamics's revenue growth over a period of 3 months has faced challenges. As of 30 June, 2024, the company experienced a revenue decline of approximately -8.84%. This indicates a decrease in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Materials sector.

Net Margin: Steel Dynamics's net margin surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 9.24% net margin, the company effectively manages costs and achieves strong profitability.

Return on Equity (ROE): Steel Dynamics's financial strength is reflected in its exceptional ROE, which exceeds industry averages. With a remarkable ROE of 4.7%, the company showcases efficient use of equity capital and strong financial health.

Return on Assets (ROA): The company's ROA is a standout performer, exceeding industry averages. With an impressive ROA of 2.84%, the company showcases effective utilization of assets.

Debt Management: Steel Dynamics's debt-to-equity ratio is below the industry average. With a ratio of 0.33, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

To track all earnings releases for Steel Dynamics visit their earnings calendar on our site.

This article was generated by Benzinga's automated content engine and reviewed by an editor.