On April 28, 2023, Westpac Banking Corp made headlines with its announcement that it had decreased its position in shares of Nucor Co. (NYSE:NUE) by 11.0% in the fourth quarter. According to the company’s most recent Form 13F filing with the Securities & Exchange Commission, Westpac Banking Corp owned 69,183 shares of the basic materials company’s stock after selling 8,578 shares during the period. The institutional investor estimated that its holdings in Nucor were worth $9,119,000 at the end of the most recent reporting period.
The news sparked a flurry of activity among industry analysts and investors alike, many of whom have been closely monitoring Nucor’s performance over the past year. Bank of America was one of the first firms to issue a report on Nucor following Westpac’s announcement, giving the company a “buy” rating and pegging its price objective at $172.00.
The Goldman Sachs Group also weighed in on Nucor’s future prospects, lifting their price target on shares of the company from $144.00 to $161.00 while offering a “neutral” rating. Credit Suisse Group joined in with an “outperform” rating and an upped target price on Nucor from $140.00 to $156.00.
Morgan Stanley offered a more cautious assessment of Nucor’s outlook heading into Q2 2023, raising their target price from $113.00 to $122.00 while retaining an “equal weight” rating on the stock.
BMO Capital Markets rounded out this chorus of voices by issuing a “market perform” rating and upping their target price from $155.00 to $165.00.
Overall, Bloomberg.com reports that six analysts are recommending holding onto Nucor stock while two have rated it as a buy – though all agree that the company’s current consensus rating is “Hold” with an average price target of $148.88.
For its part, Nucor stock opened at $148.29 on April 28, 2023 – a healthy position despite the recent sell-off by Westpac Banking Corp. Over the past 12 months, Nucor has demonstrated impressive volatility with a low of $100.13 and a high of $182.68. The stock also boasts a fifty-day moving average price of $155.55 and a 200-day moving average price of $148.64.
The company itself maintains an excellent financial profile, including a current ratio of 3.74, quick ratio of 2.28, debt-to-equity ratio of 0.33 and market cap of $37.36 billion; all factors which point towards growth over the long-term.
Despite these changes in shareholder composition and differing opinions from industry experts, Nucor remains one to watch as it looks set to continue making waves in the basic materials sector in years to come.
Institutional Investors Active in Buying Shares of Steel Producer Nucor, Despite Executive Sell-Offs
Institutional investors have been active in buying shares of Nucor, a leading producer of steel and related products based in North Carolina, according to recent reports. A number of companies made new purchases towards the end of last year and in Q1 2023, including Guardian Wealth Advisors LLC, which invested $31k; MinichMacGregor Wealth Management LLC ($32k); Nelson Van Denburg & Campbell Wealth Management Group LLC ($32k); Coston McIsaac & Partners ($34k); and Fiduciary Alliance LLC ($36k). Overall, hedge funds and institutional investors now own over three-quarters (78.33%) of Nucor. The news came alongside an announcement that executives Allen C Behr and Kenneth Rex Query recently sold thousands of shares each at prices around $175 per share.
A number of investment analysts have issued opinions on the firm’s prospects, with Bank of America giving it a “buy” rating and setting a $172 target price back in January; Goldman Sachs subsequently raised its expectations for the company’s worth from $144 to $161 per share; Credit Suisse increased its target price from $140 to $156 and upgraded Nucor from “neutral” to “outperform”; while Morgan Stanley assessed it as “equal weight” at a target rising by up to nine percent to around $122 per share. BMO Capital Markets rated it as “market perform” but still updated their predictions on where the market price could go from the previous value range. Out of eight analysts that have issued ratings over time, six are currently holding out for stabilization while two favor some buy-in potential; there is an average estimate price prediction that supports hold status.
However, recent earnings reports suggest a bright future for Nucor. For Q1 2023—ending on April 20th—Nucor posted revenue of $8.71 billion compared with estimates of $8.87 billion among analysts, and reported a net margin of 16.73% along with healthy earnings of $4.45 per share, beating predictions by $0.64 per share. The company also recently declared an upcoming dividend to be paid out in May: investors who owned shares on record as of March 31st will receive a payout of $0.51 per share, with an ex-dividend date set for March 30th – this represents a dividend payout ratio (DPR) of 8%. Predictions for Nucor’s full-year earnings come in at around $17.30 per share based on the recovery from previous year’s downturns in the steel industry sector.
Overall, these reports suggest that though some executives sold off stock at high prices, the outlook for the company is good and their growth seems poised to continue into the near future. This may make them worth considering for investors looking for stability and strong performances relative to similar companies in their sectors.
