Berenberg Downgrades Nucor (NUE) to Hold Citing Valuation after Sharp Rally

Berenberg downgraded Nucor (NYSE: NUE) from Buy to Hold with a price target of $61.00 on valuation following the sharp rally.

Analyst Alessandro Abate commented, "After a sharp rally (+20.5%) since our upgrade note (Nucor: good entry point as steel prices rise; up to Buy dated 1 November), we now downgrade to Hold. While our 2017E price target rises to $61 (from $57), on the back of our EBITDA and EPS now at $2.62bn (+4.9%) and $3.16 (+7.4%), on our more optimistic view of both US structural steel and plate, the limited upside (5.9%) might trigger profit taking. In the long term, however, we see the stock as a great beneficiary from potential US infrastructure spending, given its exposure to the construction and energy sectors. In the short term, though, we believe that the now significantly less appealing risk/reward ratio will justify our downgrade."

For an analyst ratings summary and ratings history on Nucor click here. For more ratings news on Nucor click here.

Shares of Nucor closed at $58.75 yesterday.

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