By William Trent, CFA of Stock Market Beat
Steel Dynamics (STLD) is just the right size to be one of the companies that qualifies for inclusion on our Small Cap Watch List, Mid Cap Watch List and Large Cap Watch List. Which is good, because it can now benefit all three portfolios.
Steel Dynamics Raises Earnings Guidance for First Quarter: Financial News – Yahoo! Finance
Steel Dynamics, Inc. today announced it is raising its estimate of first quarter 2007 earnings due primarily to higher shipping volumes and somewhat stronger margins than initially projected. The company now expects first-quarter diluted earnings per share to be about 10 percent higher than its preliminary first-quarter estimate of $0.85 to $0.90 per share, revising its estimated range to $0.94 to $0.98 per share. SDI’s preliminary estimate was made January 23, 2007, in the company’s earnings release. By comparison, diluted earnings per share for the first quarter of 2006 was $0.76 and for the fourth quarter of 2006 was $1.03 per share.”
Steel scrap prices are trending much higher in the first quarter than previously forecast,” Busse said. “However, we currently expect to be able to maintain our margins in the second quarter. With continued strong order entry in the second quarter, the preliminary outlook is for a solid quarter. We continue to expect 2007 to be another strong year for SDI, with a higher volume of shipments and good prospects for continued strong margins.”
The consensus estimate for the current quarter was $0.88, smack in the middle of previous guidance. The consensus for next quarter is $0.96, which implies a slowdown in the year/year earnings growth rate. Judging from the “preliminary outlook for a solid quarter” that number should probably come up as well.
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