Updated 3/11/2025
Nucor Corporation (NUE) has built a reputation as one of the strongest names in the steel industry. As the largest steel producer in the United States, the company has mastered the art of navigating economic cycles while maintaining profitability. What makes Nucor stand out is its ability to run efficiently, keeping costs low while maximizing cash flow.
For dividend investors, this is an attractive stock to consider. The company has been consistently rewarding shareholders through its dividend program, proving its commitment even when the steel industry faces headwinds. Although Nucor’s stock price has experienced some ups and downs—falling from its 52-week high of $203 to around $130—it remains a steady force for long-term investors seeking reliable income.
Key Dividend Metrics
📈 Dividend Yield: 1.69% – While not the highest yield, it’s well-supported by cash flow.
💰 Annual Dividend: $2.20 per share – A stable and growing payout over time.
🔁 Dividend Growth Streak: 51 consecutive years – A rare achievement, placing it among elite dividend stocks.
📊 Payout Ratio: 25.65% – A comfortable level, indicating room for future increases.
📆 Next Dividend Date: May 12, 2025 – Investors must own shares before March 31, 2025, to qualify for this payment.
Dividend Overview
Nucor has one of the most reliable dividend programs in the industrial sector. With an impressive 51-year history of raising dividends, the company has shown a deep commitment to rewarding shareholders, regardless of economic conditions. While its 1.69% dividend yield isn’t particularly high, it’s worth noting that Nucor prioritizes dividend growth over simply maintaining a high yield.
The payout ratio of 25.65% suggests that the dividend is highly sustainable, leaving plenty of room for future increases. Some companies pay out nearly all of their earnings in dividends, which can lead to cuts during downturns. Nucor avoids that trap, ensuring its dividend is both secure and growing over time.
Dividend Growth and Safety
For investors focused on dividend stability, Nucor checks a lot of boxes. The company has a long track record of increasing its payout and does so in a sustainable way.
🔺 Consistent Growth: The dividend has steadily increased over five decades.
🔒 Safety Cushion: A low payout ratio means the company isn’t stretching to afford dividends.
📈 Long-Term Viability: Nucor reinvests profits wisely while still returning capital to shareholders.
The steel industry is highly cyclical, meaning profits can fluctuate depending on economic conditions. However, Nucor’s unique approach to managing costs allows it to remain profitable even in tough times. This is a key reason why its dividend has continued to grow despite the ups and downs of the broader industry.
Of course, the company’s earnings are tied to steel prices, so investors should expect that dividend growth may slow during periods of lower demand. That said, Nucor’s history suggests that it will continue rewarding shareholders over the long run.
Chart Analysis
The price action of Nucor Corporation (NUE) over the past year reveals a clear downtrend, though recent developments suggest a potential shift in momentum. The stock has struggled to maintain its previous highs, experiencing a significant decline from the $200 range to its current level near $130. However, there are a few encouraging technical signals that indicate possible stabilization.
Moving Averages and Trend Direction
The 50-day moving average (blue line) has been trending below the 200-day moving average (purple line) for quite some time, which confirms that the stock has been in a prolonged bearish phase. This type of setup, often referred to as a death cross, generally signals continued downside pressure.
That being said, there is a noticeable flattening in the 50-day moving average, and the price has recently crossed above it. This suggests that downward momentum is losing steam. While the 200-day moving average remains firmly above, indicating that the longer-term trend is still bearish, a sustained move above the 50-day moving average could mark the beginning of a potential reversal.
Volume Trends and Market Participation
Trading volume appears to have been relatively consistent over the last few months, with occasional spikes, particularly in late October and early November. These high-volume days often indicate strong buying or selling interest. The large green bars around these periods suggest significant accumulation, where buyers stepped in to support the stock at lower levels.
More recently, volume levels have remained steady, indicating that there is no extreme selling pressure, but also not enough conviction yet to drive a strong breakout. A surge in volume alongside price strength could be an early confirmation of a bullish reversal.
Relative Strength Index (RSI) and Momentum
The RSI indicator, located at the bottom of the chart, provides a look into whether the stock is overbought or oversold. Throughout much of the chart, RSI has been in the lower range, indicating persistent weakness. However, in recent weeks, RSI has climbed off its lows and is approaching the neutral 50 level.
If RSI continues to rise above 50, it would suggest increasing bullish momentum. For now, it remains in a cautious zone, where further confirmation is needed before a strong directional move is confirmed.
Recent Price Action and Resistance Levels
Looking at the last few candles, the stock has been attempting to hold above the $125 level, which appears to be an area of short-term support. The most recent candle shows a push higher with a relatively strong close near the high of the day. This suggests buyers are stepping in, at least in the short term.
To sustain this upward move, the stock needs to break past key resistance levels, with the first challenge coming near the $135-$140 range, where previous price action has seen rejection. Beyond that, a break above the 200-day moving average would be a major signal that the long-term trend is shifting.
On the downside, failure to hold above $125 could lead to a retest of the recent lows around $120. If that level fails, the next area of support appears closer to $112, which aligns with the 52-week low.
Analyst Ratings
Recent evaluations of Nucor Corporation (NUE) by financial analysts show a mix of optimism and caution, with both upgrades and downgrades shaping the stock’s outlook. The consensus price target is around $154.73, indicating potential upside from its current trading levels.
📈 Upgrades
🟢 JPMorgan Chase increased its price target for Nucor to $156 from $150, maintaining an Overweight rating. Analysts cited strong cash flow generation and improving steel demand as key reasons for the adjustment. The firm sees Nucor as well-positioned to benefit from infrastructure spending and a recovery in industrial production.
🟢 Morgan Stanley also raised its price target, moving it up to $167 from $154, while reiterating an Overweight stance. The upgrade reflects expectations of higher steel prices and better-than-expected earnings resilience. Analysts pointed to Nucor’s cost-efficient production model as a competitive advantage in the current environment.
📉 Downgrades
🔴 BNP Paribas Exane revised its price target slightly lower to $147 from $148, keeping an Outperform rating. While still positive on Nucor’s fundamentals, analysts noted potential near-term headwinds due to fluctuating steel prices and uncertainty in global trade policies.
🔴 Goldman Sachs reduced its price target to $177 from $178, maintaining a Buy rating. The firm believes slower-than-expected industrial growth could moderate Nucor’s earnings trajectory in the short term, though they still see long-term upside.
The variety of perspectives highlights the dynamic nature of market sentiment, with some analysts emphasizing growth potential while others point to near-term risks.
Earnings Report Summary
Nucor’s latest earnings report paints a mixed picture, reflecting the ups and downs of the steel industry over the past year. In the fourth quarter of 2024, the company posted net earnings of $287 million, or $1.22 per diluted share. That’s a noticeable drop from the $785 million, or $3.16 per share, it earned in the same period a year earlier. Revenue also took a hit, coming in at $7.08 billion, down about 8% from the previous year’s $7.71 billion.
For the full year, Nucor generated $2.03 billion in net earnings, working out to $8.46 per share. That’s a step down from 2023, when the company brought in $4.53 billion, or $18.00 per share. Annual sales slid as well, falling 11% to $30.73 billion from $34.71 billion the previous year.
One of the biggest challenges came from lower steel prices and softer demand, which weighed on earnings from Nucor’s steel mills and steel products divisions. Fewer shipments and weaker pricing put a dent in profits, though the raw materials segment did see some improvement compared to the previous quarter.
On the operations side, Nucor’s steel mills ran at 74% capacity in the fourth quarter, holding steady from the same period in 2023. For the full year, utilization dropped slightly to 76% from 78%, signaling a bit of a slowdown in production.
Despite the earnings dip, Nucor remains in strong financial shape. The company closed out the year with $4.14 billion in cash and continued rewarding shareholders. In December, it announced a quarterly dividend of $0.55 per share, extending its impressive streak to 207 consecutive quarterly payouts. Nucor also stayed active with stock buybacks, repurchasing about 2.1 million shares in the fourth quarter at an average price of $149.81 per share.
Looking ahead, management expects first-quarter earnings in 2025 to remain fairly stable for the steel mills and steel products businesses. However, the raw materials segment might take a bit of a hit. The big question is whether steel prices and demand can pick up momentum as the year progresses.
This chart tells the story of a stock that has been under pressure for an extended period but is showing early signs that sentiment may be shifting. The next few weeks will be critical in determining whether this is a short-term bounce or the start of a more meaningful trend reversal.
Financial Health and Stability
A company’s ability to sustain and grow its dividend depends heavily on its financial strength. Nucor has built a solid foundation that supports both its operations and its shareholder payouts.
💵 Strong Cash Position: The company holds $4.14 billion in cash, providing financial flexibility.
📉 Manageable Debt: With $7.07 billion in total debt and a debt-to-equity ratio of 33%, its leverage remains under control.
📊 Solid Liquidity: A current ratio of 2.51 indicates a strong ability to cover short-term obligations.
📈 Healthy Cash Flow: Operating cash flow of $3.98 billion ensures the company can cover both business needs and dividends.
One of the key advantages Nucor has over some of its competitors is its disciplined financial management. Even when steel prices drop, the company finds ways to remain profitable, thanks to its low-cost operating model.
Quarterly revenue has seen a decline of 8.2% year over year, which could indicate some near-term headwinds. However, its strong cash reserves and efficient operations help it remain resilient even when industry conditions aren’t ideal.
Valuation and Stock Performance
From a valuation perspective, Nucor looks reasonably priced at current levels.
📉 52-Week High: $203.00
📈 52-Week Low: $112.25
📊 Current Price: Around $130
The stock currently trades at a price-to-earnings (P/E) ratio of 15.35 based on trailing earnings, with a forward P/E of 18.59. This suggests that investors are pricing in some future earnings growth. Compared to historical averages, the stock isn’t particularly expensive, but it’s not in deep value territory either.
One important factor to consider is that Nucor’s stock tends to be more volatile than the broader market. With a beta of 1.60, it’s likely to see larger price swings than the S&P 500. For long-term investors, however, short-term volatility can create opportunities to add shares at discounted prices.
Risks and Considerations
While Nucor has a lot going for it, investors should be aware of some potential risks.
🔻 Cyclical Industry: Steel prices fluctuate based on economic conditions, which can impact earnings.
🌍 Trade Policies: Tariffs and global trade disputes could affect pricing power and demand.
📉 Economic Slowdown: If construction and manufacturing activity slow down, steel demand could weaken.
📊 Stock Volatility: The stock tends to be more volatile than the overall market, meaning price swings are common.
Despite these risks, Nucor has consistently managed to weather downturns better than many of its peers. Its disciplined approach to cost management and capital allocation gives it a strong foundation to continue growing dividends even during challenging periods.
Final Thoughts
For dividend investors, Nucor is one of the most reliable names in the industrial sector. It combines steady income, long-term dividend growth, and financial resilience, making it a strong candidate for a long-term portfolio.
The company’s yield of 1.69% may not be the highest in the market, but it’s backed by a 51-year history of increases and a low payout ratio. That kind of consistency is rare, especially in a cyclical industry like steel.
While short-term stock performance may be influenced by economic conditions and steel prices, Nucor remains a long-term wealth-building stock. Investors who focus on dividend safety and slow, steady growth will likely find Nucor to be a strong fit for their portfolio.
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