Steel Dynamics Surges After Strong Q3 Earnings Guidance
Shares jump over 6% as the company forecasts EPS above analyst estimates, citing broad strength across all business segments.
Steel Dynamics, Inc. (NASDAQ: STLD) shares surged more than 6% after the company issued upbeat third-quarter earnings guidance that surpassed Wall Street expectations. The steel producer announced it anticipates diluted earnings per share (EPS) to be in the range of $2.60 to $2.64 for the quarter, comfortably above the .
The optimistic forecast reflects a significant improvement from the $2.01 EPS reported in the second quarter and last year's Q3 result. In its announcement, Steel Dynamics attributed the expected growth to stronger profitability across all of its operating platforms, including its core steel, metals recycling, and steel fabrication businesses.
The company anticipates a boost in , driven by robust shipment volumes and expanding metal spreads. This margin improvement is supported by a projected decline in scrap raw material costs that is expected to outpace a modest decrease in steel pricing. Furthermore, metals recycling operations are also poised for significantly stronger earnings due to improved spreads for ferrous materials.
Fueling this growth is continued strong demand from key end markets, particularly the non-residential construction, automotive, and energy sectors. The company's steel fabrication segment is also performing well, with a strong order backlog supporting expectations for increased shipments and stable spreads. Reinforcing its confidence, Steel Dynamics also disclosed it had repurchased $185 million of its common stock during the quarter, signaling a strong return of capital to shareholders. The company is scheduled to release its full third-quarter results .