NUE$246.47

Nucor shows a cyclical but still profitable operating profile. Revenue surged in FY2022, then fell for two years as steel pricing normalized, with FY2025 showing a modest rebound and TTM revenue above the last full year. Net income followed the same pattern, peaking in FY2022 before sliding sharply, though TTM earnings have improved versus FY2025 annualized levels. Margins have compressed materially: gross margin fell from about 30% to the low teens, and operating margin from roughly 25% to under 8% before a partial TTM recovery. No major one-off stands out, but earnings are clearly cycle-sensitive. Compared with typical industrials, profitability remains respectable, yet the recent margin erosion, weak FCF in FY2025, and volatility argue for a middle-of-the-road assessment.

Nucor’s balance sheet remains solid, with current assets of $11.8 billion against $4.0 billion of current liabilities in FY2025, implying comfortable near-term liquidity despite a notable decline from the FY2023 peak of $16.4 billion in current assets. Cash and short-term investments fell to $2.7 billion from $7.1 billion in FY2023, so liquidity is less cash-rich than before, but inventory and receivables remain substantial and manageable. Total debt of $7.1 billion is moderate relative to $35.1 billion of assets and $21.5 billion of equity. Shareholders’ equity has trended upward over time, supporting solvency. The main caution is the high level of goodwill and intangibles, which reduces tangible asset quality, but leverage and funding risk appear under control.

Cash generation has weakened materially after a very strong 2021-2022 period. Operating cash flow peaked at 10,072 million in FY2022, then fell to 7,112 million, 3,979 million, and 3,234 million in FY2025, with TTM at 3,756 million. Free cash flow followed the same pattern, dropping from 8,124 million in FY2022 to 806 million in FY2024 and turning slightly negative at -188 million in FY2025, mainly because CapEx rose to 3,422 million. Working capital swings were meaningful, especially receivables and inventories. Capital returns remained substantial through dividends and buybacks, but share repurchases slowed as cash flow tightened. Overall, the profile is decent but clearly more pressured and less consistent than earlier years.

Nucor is a non-financial industrial company. Liquidity has remained solid, with the current ratio staying around 2.5–3.6 and the quick ratio mostly above 1.3, though both have eased from earlier highs. Leverage is moderate and generally manageable: debt-to-equity has stayed near 0.3, but debt-to-EBITDA rose meaningfully in 2024–2025 before easing in the current period, suggesting some pressure from weaker earnings. Efficiency has softened versus 2021–2022, as asset turnover declined from 1.59 to just under 1.0, while inventory turnover has stayed fairly stable around 5x. Profitability has come down sharply from peak levels, with ROE, ROA, ROIC, and ROCE all trending lower, though they remain acceptable rather than stressed.

Historical data runs through FY2025, while FY2026-FY2027 are analyst-covered forecast years with forward P/E available. Revenue surged in FY2021-FY2022, then contracted sharply in FY2023-FY2024 before a modest FY2025 recovery and a stronger FY2026 rebound, followed by near-flat FY2027 growth. EPS was far more volatile, peaking in FY2022, then falling steeply through FY2025 before a projected FY2026 recovery and FY2027 continuation, suggesting margin repair after a cyclical downturn. Forward P/E of 16.8x in FY2026 and 15.5x in FY2027 looks reasonable against the expected earnings rebound, though not cheap. Sentiment is constructive: 17 analysts rate it Buy, targets are clustered well above the low case, and recommendations have been broadly stable with a slight recent uptick in Hold and one Strong Sell.