S&P Capital IQ Reiterates its BUY Rating on Steel Dynamics

October 19 00:00 2011

NEW YORK, October 19 (RainbowNewsLine.com) – Analyst Leo Larkin of S&P Capital IQ maintains his BUY rating on the shares of Steel Dynamics Inc (NASDAQ: STLD), while reducing the estimates for the company.

Analyst Leo Larkin, in a research note published yesterday mentions that the company reported its Q3 EPS of $ 0.19, which is in line with the estimates but short on Capital IQ’s consensus of $0.20. The 29% gain in sales which were more than the expected, were balanced out by margin erosion in flat roll and scrap. The analyst cuts down the Q4 and full year ’11 EPS from $0.24 to $0.19 and from $1.32 to $1.27, respectively, given the cautious near term outlook. The pricing in late December or early January’12 is expected to dip, thus reiterating ’12 EPS estimate at $$1.74 and 12-month target price at $16. STLD is selling about 6.4x of the ’12 EPS estimates which makes it attractive, the analyst adds.