Steel Dynamics (STLD) AI Stock Analysis

• Market Cap: $16.64B
• Dividend Yield: 1.7%
• Average Volume (3M): 2.08M
• Price to Earnings (P/E): 11.3
• Beta (1Y): 1.08
• Revenue Growth: -6.68%
• EPS Growth: -32.96%
• Country: US
• Employees: 13,000
• Sector: Basic Materials
• Sector Strength: 52
• Industry: Steel
• EPS (TTM): 9.79
• Shares Outstanding: 149,896,790
• 10 Day Avg. Volume: 1,918,746
• 30 Day Avg. Volume: 2,076,343
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.05
• Price to Cash Flow (P/CF): 13.30
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $149.00
• Price Target Upside: 21.48% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

Steel Dynamics shows strong financial and operational metrics, particularly in profitability and safety achievements. However, negative cash flow and market challenges weigh on the stock. The technical indicators suggest caution, and moderate valuation aligns with industry standards. Positive guidance and strategic advancements in aluminum operations support a generally favorable outlook.

Positive Factors

Diversification

The aluminum rolling mill will diversify Steel Dynamics' earnings stream and further improve profitability and free cash flow profile.

Earnings Turnaround

Sinton, which has been a material drag on earnings since 2022, is on the cusp of turning around and should start contributing to earnings.

Tariffs

Steel Dynamics is a best-in-class domestic US steel producer, with a product portfolio that is relatively well-positioned to benefit from expanded Section 232 tariffs.

Negative Factors

Market Concerns

Shares of US steel producers have not followed the recent sharp move higher in pricing due to concerns about end market demand based on recent macroeconomic data.

Steel Dynamics Business Overview & Revenue Model

Company Description

Steel Dynamics, Inc., together with its subsidiaries, operates as a steel producer and metal recycler in the United States. It operates through three segments: Steel Operations, Metals Recycling Operations, and Steel Fabrication Operations. The Steel Operations segment offers hot roll, cold roll, and coated steel products; parallel flange beams and channel sections, flat bars, large unequal leg angles, and reinforcing bars, as well as standard strength carbon, intermediate alloy hardness, and premium grade rail products; and engineered special-bar-quality products, merchant-bar-quality products, and other engineered round steel bars. The company also engages in turning, polishing, straightening, chamfering, threading, precision saw-cutting, and heat treating of bar products; and cutting to length, straightening, hole punching, shot blasting, welding, galvanizing, and coating of specialty products. Its products are used in construction, automotive, manufacturing, transportation, heavy and agriculture equipment, and pipe and tube markets. This segment sells directly to end-users, steel fabricators, and service centers. The Metals Recycling Operations segment purchases, processes, and resells ferrous and nonferrous scrap metals into reusable forms and grades. Its ferrous products include heavy melting steel, busheling, bundled scrap, shredded scrap, steel turnings, and cast-iron products; and nonferrous products comprise aluminum, brass, copper, stainless steel, and other nonferrous metals. This segment also provides transportation logistics, marketing, brokerage, and scrap management services. The Steel Fabrication Operations segment produces non-residential steel building components, such as steel joists, girders, trusses, and steel deck products. The company also exports its products. Steel Dynamics, Inc. was incorporated in 1993 and is headquartered in Fort Wayne, Indiana.

How the Company Makes Money

Steel Dynamics generates revenue primarily through the manufacturing and sale of steel products. The company's steel operations segment is its largest source of income, producing and selling numerous types of steel products to diverse markets, including construction, automotive, and manufacturing industries. The metals recycling segment contributes to revenue by acquiring and processing scrap metal, which is sold to steel mills, including those owned by Steel Dynamics, thus supporting a vertically integrated model. Additionally, the steel fabrication segment adds revenue through the production and sale of fabricated steel products used in construction. Strategic partnerships and acquisitions, along with a focus on operational efficiency and cost control, further enhance the company's profitability.

Steel Dynamics Financial Statement Overview

Summary

Steel Dynamics demonstrates robust profitability and a strong balance sheet, with commendable equity and moderate leverage. However, revenue contraction and negative free cash flow highlight potential risks. The company must address these cash flow challenges to sustain its financial health.

Income Statement

Steel Dynamics exhibits strong profitability with a TTM gross profit margin of 15.88% and a net profit margin of 8.76%. However, a decline in revenue from $18.80 billion in 2023 to $17.54 billion in the TTM period indicates a revenue contraction of -6.58%, impacting overall performance. Despite this, the company's EBIT margin remains healthy at 11.08%, showcasing operational efficiency.

Balance Sheet

The company maintains a solid balance sheet with a debt-to-equity ratio of 0.36, indicating moderate leverage. The return on equity stands at 17.20%, reflecting effective use of shareholders' funds. Additionally, the equity ratio of 59.82% signifies a strong equity position, contributing to financial stability.

Cash Flow

Steel Dynamics experiences challenges in cash flow with a free cash flow growth rate of -101.26%, due to reduced cash flow from operations and significant capital expenditures. The operating cash flow to net income ratio of 1.20 suggests adequate cash generation relative to net income, but the negative free cash flow poses a concern.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
17.54B	18.80B	22.26B	18.41B	9.60B
	Gross Profit
2.80B	4.05B	6.12B	5.36B	1.43B
	EBIT
1.94B	3.15B	5.09B	4.30B	847.14M
	EBITDA
2.52B	3.73B	5.50B	4.61B	1.19B
	Net Income Common Stockholders
1.54B	2.45B	3.86B	3.21B	550.82M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
737.27M	2.12B	2.26B	1.24B	1.37B
	Total Assets
14.94B	14.91B	14.16B	12.53B	9.27B
	Total Debt
3.23B	3.20B	3.07B	3.11B	3.10B
	Net Debt
2.64B	1.80B	1.44B	1.86B	1.73B
	Total Liabilities
5.99B	6.07B	6.06B	6.21B	4.92B
	Stockholders Equity
8.93B	8.87B	8.13B	6.30B	4.35B
Cash Flow		Free Cash Flow
-23.50M	1.86B	3.55B	1.20B	-211.02M
	Operating Cash Flow
1.84B	3.52B	4.46B	2.20B	987.03M
	Investing Cash Flow
-1.30B	-1.97B	-1.88B	-999.42M	-993.26M
	Financing Cash Flow
-1.35B	-1.78B	-2.20B	-1.33B	-7.05M

Steel Dynamics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 122.65
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STLD, the sentiment is Negative. The current price of 122.65 is below the 20-day moving average (MA) of 122.74, below the 50-day MA of 126.88, and below the 200-day MA of 125.70, indicating a bearish trend. The MACD of -0.74 indicates Negative momentum. The RSI at 45.79 is Neutral, neither overbought nor oversold. The STOCH value of 34.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for STLD.

Steel Dynamics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RS	77 Outperform	$14.82B	17.85	11.71%	1.72%	-6.56%	-31.89%
STLD	73 Outperform	$16.64B	11.28	17.27%	1.70%	-6.68%	-32.96%
MT	73 Outperform	$20.00B	14.31	2.60%	1.81%	-8.56%	68.36%
NUE	71 Outperform	$24.22B	12.41	9.79%	2.10%	-11.46%	-53.33%
PKX	65 Neutral	$12.65B	17.21	2.06%	3.92%	-9.67%	-37.38%
X	57 Neutral	$10.08B	28.47	3.43%	0.45%	-13.48%	-56.94%
Sector *	47 Neutral	$2.43B	-2.83	-21.77%	3.74%	4.16%	-28.83%

Steel Dynamics Corporate Events

Steel Dynamics Projects Strong Q1 2025 Earnings

On March 17, 2025, Steel Dynamics, Inc. announced its first quarter 2025 earnings guidance, projecting earnings per diluted share between $1.36 and $1.40. The company’s steel operations are expected to see increased profitability due to higher shipments, despite some metal margin compression. The Sinton Texas Flat Roll Division operated at over 90% production capacity, indicating a path to profitability by the second quarter. Metals recycling operations are also expected to perform better than the previous quarter, while steel fabrication earnings are anticipated to be lower due to seasonal factors. The company is advancing its aluminum operations, with significant progress in its Columbus, Mississippi mill and San Luis Potosi center. Additionally, Steel Dynamics increased its cash dividend by nine percent and authorized an additional $1.5 billion for share repurchases, reflecting confidence in its financial outlook.