Steel Dynamics (STLD) Outpaces Stock Market Gains: What You Should Know

Steel Dynamics (STLD) closed at $101.05 in the latest trading session, marking a +1.84% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.93%. Meanwhile, the Dow gained 0.56%, and the Nasdaq, a tech-heavy index, added 1.71%.

Heading into today, shares of the steel producer and metals recycler had gained 2.08% over the past month, outpacing the Basic Materials sector's loss of 1.54% and lagging the S&P 500's gain of 4.61% in that time.

Wall Street will be looking for positivity from Steel Dynamics as it approaches its next earnings report date. The company is expected to report EPS of $5.12, down 23.92% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.57 billion, down 10.36% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $16.15 per share and revenue of $19.79 billion. These totals would mark changes of -28.79% and -11.12%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Steel Dynamics. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.65% lower within the past month. Steel Dynamics currently has a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Steel Dynamics has a Forward P/E ratio of 6.15 right now. This represents a discount compared to its industry's average Forward P/E of 7.5.

The Steel - Producers industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 72, which puts it in the top 29% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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