Citi reiterates 'Buy' Rating on Nucor (NUE), Says Sell-off Oversimplified, Overdone
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Citi reiterates a 'Buy' rating on Nucor (NYSE: NUE), saying sell-off oversimplified, overdone. Price target $90.
Citi analyst says, "We see reaction to 2Q as excessive, considering Sheet hikes set for next week, stronger-than-advertised mill margins, and guidance history. Steel seems to be rotating from the "Commodity momentum phase," to the "Earnings discovery phase." This is likely to see a rotation in the shareholder base, creating opportunity for longer-term value investors...NUE seems to discount a worst-case scenario of $5 – 6 in EPS at a 10x multiple. Considering Steel fundamentals, financials, low valuation, credible growth, and +3.5% yield, we would be buyers."
Nucor Corporation is engaged in the manufacture and sale of steel and steel products. The Company operates in two business segments: steel mills and steel products. [SM]
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