Nucor Company NUE is expected to release third quarter 2021 results before the bell on October 21. Rising domestic steel prices, driven by picking up demand and supply constraints, likely supported the steel giant’s sales and margins in the third quarter. The benefits of higher sheet and plate selling prices are expected to be reflected in the performance of its steel business.

Higher prices to increase profitability

Profitability of Nucor’s steel mills and steel product segments is expected to have been boosted by higher average selling prices during the September quarter. In the Steel Mills business, sheet metal is likely to have experienced higher selling prices in the third quarter, driving the results for these product groups.

Zacks’ consensus estimate for the third quarter average selling price per tonne for the company’s steelworks unit is $ 1,328, which suggests a 107.8% year-over-year increase. the other. The same for plate products is set at $ 1,433, reflecting a 114.8% year-over-year increase. Zacks’ consensus estimate for sheet products is $ 1,523, which reflects an increase of about 156% year-over-year.

In addition, the consensus estimate of the average selling price per tonne for the Company’s unit of steel products is set at $ 1,857, which suggests a 35.4% year-over-year increase.

US steel prices have seen an unprecedented rise this year due to strong underlying supply and demand fundamentals. Hot-rolled coil (“HRC”) benchmark prices increased significantly during the September quarter on the back of strong demand in key end markets such as automotive and construction and supply shortages. HRC prices exceeded $ 1,900 per short ton in August 2021 and remained above that level until September. The effects of the surge in prices are expected to be reflected in Nucor’s bottom line and superior results in the third quarter.

Nucor Corporation and BPA Surprise Award

Nucor Corporation price-eps-surprise | Quote Nucor Corporation

Overall expectations

Zacks’ consensus estimate for Nucor’s third quarter consolidated revenue is currently set at $ 10,098 million, reflecting a 104.9% year-over-year increase. The consensus estimate for profit is $ 7.48, indicating a substantial increase over the previous year’s numbers.

Zack model

Our proven model does not conclusively predict an increase in profits for Nucor this season. The combination of a positive earnings ESP and a Zacks # 1 (strong buy), 2 (buy) or 3 (hold) ranking increases the odds of beating the winnings. But it is not the case here.

ESP on income: ESP gains for Nucor are 0.00%. You can discover the best stocks to buy or sell before they are flagged with our ESP Earnings Filter.

Zack Rank: Nucor currently wears a Zacks Rank # 1.

Actions worth a look

Here are a few companies in the basic materials space that you might want to consider, as our model shows they have the right mix of elements to show superior profit this quarter:

Olin Company OLN, whose earnings release is scheduled for Oct. 21, has an ESP on earnings of + 6.95% and is Zacks # 1. You can see The full list of today’s Zacks # 1 Rank stocks here.

Nutrien Ltd. NTR, which is scheduled to release its results on November 1, has an ESP on earnings of + 0.77% and is ranked Zacks # 1.

The Chemours Company CC, who is due to release his results on November 4, has an ESP on earnings of + 5.70% and carries Zacks rank 2.

Zacks’ top picks for leveraging artificial intelligence

This world-changing technology is expected to generate $ 100 billion by 2025. From self-driving cars to analyzing consumer data, people are relying on machines more than ever. Now is the time to capitalize on the 4th industrial revolution. Zacks’ Urgent Special Report Reveals 6 AI Choices Investors Need To Know Today.

See 6 artificial intelligence stocks with extreme upside potential >>

Click to get this free report

Nucor Corporation (NUE): Free Stock Analysis Report

Olin Corporation (OLN): Free Stock Analysis Report

The Chemours Company (CC): Free Stock Analysis Report

Nutrien Ltd. (NTR): Free Stock Analysis Report

To read this article on Zacks.com, click here.

Zacks investment research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.