Steel Dynamics, Inc. STLD is set to release first-quarter 2025 results after the closing bell on April 22.

Steel Dynamics’ earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 3.6%, on average. The company posted an earnings surprise of around 5.4% in the last reported quarter. Its first-quarter results are likely to have been supported by higher profitability in steel operations.

Shares of STLD have gained 3.7% year to date compared with the Zacks Steel Producers industry’s 1.2% rise.

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Let’s see how things are shaping up for this announcement.

What do STLD’s Estimates Say?

Steel Dynamics envisions first-quarter earnings in the range of $1.36 to $1.40 per share.

The Zacks Consensus Estimate for revenues for Steel Dynamics for the to-be-reported quarter is pinned at $4,149.5 million, suggesting a year-over-year decline of 11.6%.

Factors at Play for STLD Stock

Higher profitability in the company’s steel operations is expected to have aided its first-quarter results. Steel Dynamics, last month, said that its steel operations are expected to be more profitable in the first quarter than the fourth quarter, with higher shipments more than offsetting some metal margin compression, as contractual steel pricing lagged recent spot price improvements. The energy, non-residential building, automotive and industrial sectors continue to drive demand. Our estimate for total external steel shipments is pegged at roughly 2.79 million tons for the first quarter, indicating a 6.6% sequential rise and flat year over year.

Meanwhile, U.S. steel prices saw a sharp decline last year amid increased imports and weaker end-market demand. Benchmark hot-rolled coil (HRC) prices tumbled more than 40% last year to close near the $700 per short ton level from $1,200 per short ton at the beginning of 2024. 

The recent steel mill price hikes and the Trump administration's imposition of a 25% tariff on all steel imports into the United States have led to an uptick in HRC prices to above $900 per short ton. However, the benefits of the price uptick are unlikely to be reflected in steel companies' first-quarter performance. Also, a significant recovery in steel prices is not expected over the near term, given the weak manufacturing and construction backdrop and a still-challenging demand environment.  

Lower average realized selling prices are likely to have impacted STLD’s margins in the quarter to be reported. Our estimate for first-quarter average external selling price for the company’s steel operations stands at $1,019, suggesting a 15.1% year-over-year decline.

Steel Dynamics, Inc. Price and EPS Surprise

Steel Dynamics, Inc. price-eps-surprise | Steel Dynamics, Inc. Quote

What Our Model Unveils for STLD Stock

Our proven model does not conclusively predict an earnings beat for STLD this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP for STLD is 0.00%. The Zacks Consensus Estimate for the first quarter is currently pegged at $1.39. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: STLD currently carries a Zacks Rank #2.

(Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Basic Materials Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

CF Industries Holdings, Inc. CF, scheduled to release earnings on May 7, has an Earnings ESP of +10.11% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for CF’s earnings for the first quarter is currently pegged at $1.45.

Agnico Eagle Mines Limited AEM, slated to release earnings on April 24, has an Earnings ESP of +20.00% and carries a Zacks Rank #3 at present.

The consensus mark for AEM’s first-quarter earnings is currently pegged at $1.19.

Kinross Gold Corporation KGC, scheduled to release first-quarter earnings on May 6, has an Earnings ESP of +18.07%.

The Zacks Consensus Estimate for Kinross Gold's earnings for the first quarter is currently pegged at 21 cents. KGC currently carries a Zacks Rank #3.

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Steel Dynamics, Inc. (STLD) : Free Stock Analysis Report

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This article originally published on Zacks Investment Research (zacks.com).

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