On September 30, 2023, it was reported that Artemis Investment Management LLP had reduced its holdings in Steel Dynamics, Inc. (NASDAQ:STLD) by 60.3% during the second quarter. The company filed a 13F report with the Securities & Exchange Commission, stating that it now owns 25,946 shares of Steel Dynamics’ stock after selling 39,384 shares. At the end of the most recent quarter, the value of Artemis Investment Management LLP’s holdings in Steel Dynamics amounted to $2,823,000.
Steel Dynamics released its quarterly earnings results on July 20th. The basic materials company reported earnings per share (EPS) of $4.81 for the quarter, falling slightly short of analysts’ consensus estimates of $4.82 by $0.01. Additionally, the company’s revenue for the quarter was $5.08 billion compared to analyst estimates of $5.51 billion. This represents an 18.2% decrease in revenue compared to the same period last year.
Despite missing estimates for this recent quarter, overall Steel Dynamics has shown strong performance with a return on equity of 40.44% and a net margin of 14.66%. During the same quarter last year, the company earned $6.73 per share.
Sell-side analysts currently predict that Steel Dynamics will post earnings per share of $15.54 for the current year.
Several brokerages have recently issued reports on STLD’s performance and outlooks for the future market value of its stock. BMO Capital Markets lowered their target price from $115.00 to $107.00 and rated it as “market perform”. JPMorgan Chase & Co., on the other hand, upgraded their target price from $94 to $95 but maintained an “underweight” rating for Steel Dynamics.
BNP Paribas downgraded their rating from “outperform” to “neutral” and set a price target of $102.00 for the stock. Morgan Stanley, however, raised their target price from $97.00 to $99.00 and rated it as “equal weight”.
Citigroup also changed its rating on Steel Dynamics, upgrading it from “neutral” to “buy” and setting a price target of $130.00.
Overall, according to data from Bloomberg.com, the consensus rating for Steel Dynamics is “Hold”, with seven analysts assigning a hold rating, two issuing a buy rating, and one giving it a sell rating. The consensus target price for the stock is $109.89.
As an investment management firm reduces its holdings in Steel Dynamics and mixed reports surface regarding the company’s future performance, investors should closely monitor updates and market trends related to this NASDAQ-listed stock.
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Steel Dynamics, Inc.: Institutional Investors Show Confidence in Potential Growth
Steel Dynamics, Inc. (STLD), a leading provider of steel products and solutions, has seen some significant activity from hedge funds and institutional investors recently. This activity could have an impact on the company’s stock value and overall market performance.
One notable investor is the Teacher Retirement System of Texas, which increased its holdings in Steel Dynamics by 127.8% during the second quarter of this year. The pension fund now owns 291,537 shares of the company’s stock, valued at $31,757,000. This increase in ownership shows a strong belief in the potential growth and profitability of Steel Dynamics.
Another investor that has shown confidence in Steel Dynamics is Allworth Financial LP. The firm increased its holdings by 200.5% during the same period, now owning 13,872 shares valued at $1,511,000. This vote of confidence from Allworth Financial suggests that they see long-term potential in the company.
Blackhawk Capital Partners LLC also raised its position in Steel Dynamics by 25.0% during the second quarter. With ownership of 7,352 shares worth $801,000, Blackhawk Capital Partners LLC demonstrates its belief in the company’s ability to generate returns.
TFB Advisors LLC and Diversified Trust Co also increased their stakes in Steel Dynamics during the second quarter by 17.5% and 13.4%, respectively. These firms now own 3,239 and 3,460 shares each, further bolstering institutional support for Steel Dynamics.
What all these investment activities indicate is that hedge funds and other institutional investors have recognized potential value in Steel Dynamics’ stock. With a strong backing from these key players in the investing world who represent roughly 81% of total ownership of the company’s stock it will be interesting to see how this impacts future market performance.
In terms of share price performance as at September 30th , STLD opened at $105.95. The stock has a market capitalization of $17.55 billion and a price-to-earnings (P/E) ratio of 6.18, which suggests that the stock may be undervalued compared to its peers in the industry. Its beta of 1.51 indicates that it is more volatile than the broader market.
Steel Dynamics has a relatively healthy balance sheet, with a debt-to-equity ratio of 0.35, indicating that it carries less debt compared to equity, making it an attractive option for investors seeking companies with low financial risk.
The company’s fifty-day moving average stands at $103.56, just slightly below its two-hundred-day moving average of $103.63, suggesting that the stock has been relatively stable in recent months.
Several brokerages have recently issued reports on STLD, providing insights into the stock’s potential value. BMO Capital Markets lowered its target price from $115.00 to $107.00 but maintained a “market perform” rating for the company in their report on Tuesday, September 19th.
JPMorgan Chase & Co., on the other hand, boosted its target price from $94.00 to $95.00 and gave Steel Dynamics an “underweight” rating in their report released on September 8th.
Overall consensus from analysts’ reports indicates a “Hold” rating for Steel Dynamics, with a consensus target price of $109.89 based on data from Bloomberg.com.
On October 16th , Steel Dynamics announced its quarterly dividend to shareholders. Those holding shares as of September 30th will receive a dividend payment of $0.425 per share—representing an annualized dividend yield of about 1.60%. With this payout ratio at approximately 9.91%, Steel Dynamics aims to provide returns to its shareholders while maintaining financial stability.
In terms of insider trading news related to Steel Dynamics, Director Gabriel Shaheen sold 1,717 shares of the company’s stock in late July. The sale was made at an average price of $105.80 per share, amounting to a total value of $181,658.60. Following this transaction, Shaheen now owns 83,074 shares in the company worth approximately $8,789,229.20.
Christopher A. Graham, SVP of Steel Dynamics, also sold 48,000 shares in August at an average price of $105.03 per share. This transaction resulted in a total value of $5,041,440.00 and reduced Graham’s stake in the company to 61,353 shares valued at $6,443,905.59.
Insider transactions can provide insight into how those closely associated with the company perceive its future prospects.
With all these developments in mind, it is important for investors to carefully evaluate the various factors impacting Steel Dynamics’ stock performance as they make investment decisions going forward.
