The steel inventory has already increased by 38% in 2021
Steel Dynamics, Inc. (NASDAQ: STLD) is one of the largest domestic steel producers and metals recyclers in the United States. The American company is based in Fort Wayne, Indiana, and is the third largest manufacturer of carbon steel products in the United States.
On April 7th, Steel Dynamics announced that it would publish its first quarter results after the market closed on Monday, April 19th. STLD has exceeded consensus expectations in all four of its most recent earnings reports. This morning STLD is up 2.1% to $ 51.47.
For the first quarter of 2020, Steel Dynamics beat analysts’ estimates by a margin of $ 0.09 and reported earnings per share (EPS) of $ 0.88. For the second quarter of 2020, STLD cut earnings per share to $ 0.47 but beat expectations with a margin of $ 0.12. For the third quarter of 2020, Steel Dynamics posted earnings growth that rose to $ 0.51 per share, beating estimates by $ 0.04. In its most recent quarterly announcement, Steel Dynamics reported earnings per share of $ 0.97, beating expectations with a margin of $ 0.15.
STLD more than doubled year over year, rising 150% after hitting a 52-week low of $ 20.58. Steel Dynamics stock is also up nearly 38% year-to-date. STLD is currently only down 2% from its 52-week high of $ 52.59. Additionally, Steel Dynamics’ forward dividend is $ 1.04, which translates to a dividend yield of 2.06%.
If you dig into the basics of Steel Dynamics stock, you will find that the company has not done well over the past few years. STLD revenue declined more than 8%, or $ 860 million, in 2020 and has declined 19%, or $ 2.22 billion, since 2018. The bottom line is that it’s even worse for Steel Dynamics. The company’s net income declined 18% in 2020 and a whopping 56% since 2018.
Steel Dynamics stock offers an incredibly low price-to-earnings-ratio of 8.68, which is a big difference from its current price-to-earnings-ratio of 19.79. Overall, Steel Dynamics stock may not offer the best potential for long-term investment, but we could see the recent uptrend prolong in the short term based on Monday’s earnings performance.