Steel Dynamics Inc. (Nasdaq: STLD) – Q2 FY 2011 Earnings Preview
By:NewsyStocks   Thursday, July 07, 2011 12:45 PM

Carbon steel products manufacturer Steel Dynamics Inc. (Nasdaq: STLD) is expected to report its second quarter earnings results on July 18, 2011. In the last four quarters ended December 2010, the company's reported EPS missed analysts' consensus estimates on three occasions. For quarters ending June, September and December, it missed analysts' estimate by margins of 12 percent, 10 percent, and 12.50 percent, respectively. For the quarter ended March 2011 it exceeded analysts' consensus estimate by margin of 12.20 percent.

Steel Dynamics Inc. is one of the largest steel producers and one of the largest metals recyclers in the United States based on a current estimated annual steel-making capability of 6.4 million tons and actual recycling volumes. Actual metals recycling shipments during 2008, 2009, and 2010, respectively, were 5.0 million gross tons, 3.6 million gross tons, and 5.2 million gross tons of ferrous materials; and 912 million pounds, 780 million pounds and 961 million pounds of nonferrous metallics. The company operates in three segments: steel operations, metals recycling and ferrous resources operations, and steel fabrication operations.

For Q1 FY 2011

  • The company reported net sales of $2 billion, up 30 percent, compared with net sales of $1.55 billion in the same quarter last year.
  • Net income rose 63 percent to $106 million, from $64 million in the first quarter FY 2010.
  • Earnings were $0.46 per diluted share, up from $0.29 per diluted share in the comparable quarter last year.
  • Steel shipments were 1.5 million tons, 4 percent higher than the first quarter of 2010 and 10 percent higher than the fourth quarter of 2010.

For FY 2010

For full year 2010, net income was $141 million, or $0.64 per diluted share, on net sales of $6.3 billion, in comparison with a net loss of $8 million, or $0.04 per diluted share, on net sales of $4.0 billion for 2009.

Q2 FY 2011 Company's Guidance

Steel Dynamics expects second quarter earnings to be in the range of $0.35 to $0.40 per diluted share, somewhat lower than the first quarter 2011 reported results of $0.46, but higher than earnings of $0.22 per diluted share achieved in the second quarter of 2010. The company's steel operations' operating results are also expected to be further improved during the current quarter.

Analysts Forecast

For the second quarter, analysts' EPS estimates range from a low of $0.38 to a high of $0.60 per share, compared with a consensus estimate of $0.22 per share to $0.45 per share in the year ago quarter. For this quarter, analysts' revenue estimates range from a low of $2.03 billion to a high of $2.28 billion, compared with a consensus estimate of $1.63 billion to $2.18 billion in the same quarter a year ago. For the second quarter, the consensus EPS forecast has been decreased from $0.57 per share estimated 30 days ago to the current estimate of $0.45 per share. In the last 52 weeks, STLD's shares have been trading in the range of $12.89 to  $20.70. The stock last traded at $15.70, up 0.26 percent, on June 27.