It has been about a month since the last earnings report for Steel Dynamics (STLD). Shares have added about 8.7% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Steel Dynamics due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Steel Dynamics Tops Q4 Earnings, Misses Revenue Estimates
Steel Dynamics reported fourth-quarter 2025 earnings of $1.82 per share, up from $1.36 in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate of 1.72.
Net sales in the fourth quarter were up around 14% year over year to roughly $4.4 billion. The metric fell short of the Zacks Consensus Estimate of $4.54 billion.
Segment Highlights
Net sales for steel operations were $3.14 billion in the reported quarter, up around 18.7% year over year. Steel Dynamics registered steel shipments of roughly 3.3 million tons in the quarter, topping the consensus estimate of 3.29 million tons.
Steel Dynamics' steel operations reported an average external product selling price of $1,107 per ton, up from $1,011 in the year-ago quarter and down from $1,119 in the previous quarter. The figure beat the consensus estimate of $1092 per ton.
Net sales of Metal’s recycling operations were $463 million in the quarter under review, down around 4% from the year-ago quarter. Steel Dynamics registered ferrous shipments of around 1.52 million gross tons in the quarter, up roughly 7% year over year. The figure outpaced the consensus of 1.44 million gross tons.
The company's steel fabrication operations reported sales of around $347.3 million, down roughly 12.3% year over year. Steel Dynamics recorded steel fabrication shipments of 138,375 tons in the quarter, down around 5.2% year over year. The figure missed the consensus estimate of 142,000 tons.
Financial Position
Steel Dynamics ended the quarter with cash and cash equivalents of $769.9 million, up around 31% year over year. Long-term debt was around $4.18 billion, up roughly 49%.
The company generated cash flow from operations of $272.7 million in the reported quarter, down around 21.4% year over year.
Outlook
The company expects better trade conditions and a favorable interest rate environment to support solid steel and aluminum demand, with rising interest in low-carbon, U.S.-made metals. Commissioning and start-up of the Columbus aluminum flat rolled mill and San Luis Potosí slab center are progressing well. Backed by a focus on quality, efficiency and sustainability, the company expects strong long-term growth and value creation ahead.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates revision.
VGM Scores
At this time, Steel Dynamics has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, the stock was allocated a score of B on the value side, putting it in the top 40% for value investors.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending upward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Steel Dynamics has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Steel Dynamics, Inc. (STLD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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