CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We increase our 12-month target by $11 to $167, which assumes an EV/EBITDA of 7.5x our ’24 EBITDA estimate, a premium to NUE’s three-year avg. forward EV/EBITDA of 5.5x and above peers’ avg. forward EV/EBITDA of 6.6x. We raise our ’24 EPS estimate by $0.54 to $12.87 and initiate our ’25 EPS forecast at $12.10. NUE posts Q4 adj. EPS of $3.16 vs. $4.89, $0.33 above consensus, with in-line sales. Q4 avg. sales price fell 15% Y/Y but shipment volume rose 8% Y/Y. NUE is facing some very difficult comps in ’24 and we forecast a decline in adj. EPS of 28% in ’24 and 6% in ’25 (and adj. EBITDA declines of 23% in ’24 and 3% in ’25). NUE currently trades at a significant premium to its historical average (51% premium to its three-year avg. forward EV/EBITDA) and a 26% premium relative to peers. We recognize secular tailwinds from onshoring of manufacturing and strong infrastructure demand, but we are concerned that Y/Y declines in adj. EPS throughout ’24 will lead to earnings multiple contraction.