NUCOR CORPORATION (NUE): what the price requires

At today's price, NUCOR CORPORATION (NUE) is priced for +22.0% growth. boothcheck doesn't publish a fair value or a price target; it shows what the price assumes, so you can judge whether that bar is too high.

Generated: 2026-07-14 · Exported: 2026-07-16 · Source: https://boothcheck.com/report/NUE

Headline

FieldValue
TickerNUE
CompanyNUCOR CORPORATION
Current price$232.94/sh
CompositionSheet 28% / Bar 18% / Structural 8% / Plate 8% / Tubular Products 4% / Rebar Fabrication 6% / Joist and Deck 7% / Building Systems 4% / Other Steel Products 11% / Raw Materials 7%

What The Price Requires (Inversion)

The assumption today's price embeds, recovered by inverting the valuation.

FieldValue
Inversion basiswhole-company
Operating margin needed8.9%
Operating margin today9.2%
Margin compression implied-0.3pp
Implied growth22.0%
Multiple paid18x operating income

The operating-margin requirement is derived from the framework's value band at year 12, a separately labeled basis from the headline growth/duration solve.

Solve inputs: computed at a 10.5% cost of capital with 4% terminal growth over a 5-year stage; each 1pp of cost of capital moves the implied operating-profit growth ~6.7pp.

Reconcile: at the x-ray's 9.3% required return this reads ~13.4%/yr; the models below use their own rates.

How unusual the bet is: within-range

ReferenceValue
vs own history+0.92σ
cohort percentile (of 76 peers)49
sustained it ~5 years at this level39%
implied end-window share0%

Valuation X-Ray

Asset, earnings-power and peer-multiple models all land far below the price; ONLY the growth-DCF reaches it. The bet is durable compounding the static frames structurally cannot price (a moat/durability premium).

How the valuation models price the stock relative to the market price. Price/FV above 1.0 means the market pays more than that lens defends (expensive); at or below 1.0 the lens can defend the price.

FamilyMedian price/FVModelsReads
Asset1.95x4expensive
Earnings4.47x4expensive
Relative1.58x5expensive
Growth0.97x3justifies

Families that justify the price: Growth Families that call it expensive: Asset, Earnings, Relative

The models below discount at their own flat-beta convention rates (cost of equity 9.3%, WACC 9.3%); the inversion above states its own rate.

Per-Model Detail (n=16)

ModelFamilyFVPrice/FVApplicableMethodology
DCF Perpetual GrowthGrowth$69.933.33xyesFCF base $0.5B, growth 12% (input: historical growth), terminal g 4.0%, WACC 9.3%, 5yr projection
DCF Exit MultipleGrowth$253.180.92xyesExit EV/EBITDA: 36.3x / 41.3x / 46.3x (bear / base = today's held flat / bull), 5yr
Relative ValuationRelative$147.411.58xyesP/E 16.67x (blended: static sector reference 14x + trailing (TTM) 23x), scenarios: 12.5x / 16.7x / 20.0x (bear / base = reference held flat / bull), EV/EBITDA 17.6x
Simple DDMGrowth——no—
Two-Stage DDMGrowth——no—
Simple Excess ReturnAsset$109.902.12xyesBV/sh $93.56, ROE (TTM) 10.9%, ke 9.3%
Two-Stage Excess ReturnAsset$118.751.96xyes5yr excess ROE then converge to ke=9.3%
Discounted Future Market CapGrowth$239.980.97xyesRev $34.2B, growth 12% (input: historical growth; tapered), Terminal P/S: 1.2x / 1.6x / 1.9x (bear / base = today's held flat / bull, cap 6x)
Peter Lynch Fair ValueRelative$120.961.93xyesEPS $10.08, growth 1% (input: historical EPS growth), PEG=16.30 (Overvalued)
Margin TrajectoryGrowth——no—
Earnings Power ValueEarnings——no—
Residual IncomeAsset$120.441.93xyesBV $93.56 + 5yr PV of (ROE (TTM) 10.9% − Kₑ 9.3%) × BV; BV grows 7.1%/yr
Graham NumberAsset$145.671.60xyes√(22.5 × EPS $10.08 × BVPS $93.56) — Graham's conservative floor
EV/EBITDA RelativeRelative$52.534.43xyesEBITDA $1.24B × sector EV/EBITDA 8.0x
FCF YieldEarnings$34.216.81xyesFCF $532.0M / Kₑ 9.3% — zero-growth perpetuity
SBC-Adj FCF YieldEarnings$27.758.39xyesSBC-adj FCF $0.40B (FCF $0.53B − SBC $0.14B) capitalized at Kₑ
Ben Graham FormulaEarnings$325.250.72xyesEPS $10.08 × (8.5 + 2×15.0%) × (4.4 / 5.3%)
ROIC-Justified P/BAsset——no—
P/Sales SectorRelative$223.461.04xyesRevenue $34.16B × sector P/S 1.5x
PEG Fair ValueRelative$378.000.62xyesEPS $10.08 × (PEG 1.5 × growth 25.0% (input: historical EPS growth)) → PE 37.5x
Earnings YieldEarnings$108.972.14xyesEPS $10.08 / required return 9.3% (Rf 4.3% + ERP 5.0%)
Funds From Operations MultipleRelative——no—
Clinical Phase NPVGrowth——no—
MertonAsset——no—
V5 Mechanical———no—

Solvency

FieldValue
Net debt$4.5b
Net debt / NOPAT (after-tax)1.80x
Net debt / operating income (pre-tax)1.43x
Interest coverage17.9x
Share count CAGR (buyback)-4.2%
Burning cashno

Bullet Takeaways

Bull Case

The obvious bear case on Nucor is that steel is a commodity and commodity earnings mean-revert, so paying up at the top of the cycle is a mistake. That is the right instinct for most steelmakers. It is the wrong one for the lowest-cost producer, and the data shows why. Nucor runs electric arc furnaces fed by scrap, a structure the 10-K describes as a "flexible, highly variable cost base," which means when demand falls the company can pull back output and cut cost in step rather than bleeding through fixed overhead the way an integrated blast-furnace mill does. The cost curve, not the cycle, is the durable advantage, and Nucor sits at the bottom of it.

That advantage is widening for a reason competitors cannot easily copy: emissions. The 10-K notes that customers are "expressing greater concern for the GHG emissions in their supply chains and are prioritizing" lower-carbon steel, and that electric arc furnaces have "a significantly lower GHG intensity than blast furnace based competitors who have historically supplied the region." As buyers weight carbon alongside price, Nucor's process becomes a commercial advantage rather than only a cost one, and it has spent years acquiring and building capacity in higher-margin downstream products to capture more of the value chain.

The recent print shows the model at work. Q1 2026 net sales rose 21% to $9.50 billion, diluted EPS of $3.23 beat the $2.82 consensus, and the steel mills segment posted record quarterly shipments alongside a 14% rise in average selling price per ton. Capital allocation rounds out the case: interest coverage runs around 20 times operating income, net debt is modest at about 1.4 times operating profit, and the share count has fallen roughly 4% a year, so the company returns cash while it compounds. Management guided to higher earnings across all three segments in the second quarter.

Bear Case

The price is making a specific bet that the bear should name precisely: that the current strong earnings are closer to the new normal than to a cyclical peak. At today's price, the math implies revenue growing on the order of 23% with operating margins near the high single digits, and the company is already earning a trailing operating margin around 9.3%, slightly above what the price requires it to settle at. In other words, the price is not betting on a margin miracle; it is betting that this above-mid-cycle level of profitability persists and grows. For a commodity producer, that is the heart of the question, because steel earnings have always been a function of where in the cycle you measure them.

The most fragile assumption baked into the price is that the favorable conditions of early 2026 hold. The Q1 strength leaned heavily on two things that can reverse: a 14% jump in average selling price per ton, and a sharp drop in import competition under Section 232 tariffs that took finished-steel import share from over 22% down to about 15%. Tariffs are policy, and policy changes. The 10-K is candid that surplus foreign output driven by "rather than price and demand signals" can flow into the U.S. and "result in downward pressure" on prices. If trade protection eases or global overcapacity finds its way back in, both the price per ton and the volume premium compress at once.

The valuation methods reflect how much of the cycle is already in the price. Asset value, earnings power, and peer multiples all read the stock as richly valued, with the earnings-power lens sitting several times below the price because it is measuring against earnings the cycle inflated. Only the growth-based methods reach the price, and they get there by assuming durable compounding. The balance sheet is sound, with net debt at about 1.4 times operating profit and coverage near 20 times, so this is not a solvency bear. It is a cyclicality bear: a buyer at today's price is underwriting the proposition that the steel cycle has flattened, and history says cycles rarely stay flat for long.

Valuation

The cleanest way to read Nucor's price is as a bet on durability rather than on cheapness. Inverting the price gives an implied revenue growth around 23% against an operating margin near the high single digits, roughly 8%, which is actually a touch below the trailing margin of about 9.3% the company earns today. The price is therefore not asking for an earnings breakout; it is asking for the current, above-average level of profitability to persist and to grow from here. For a cyclical, that is the entire valuation argument: is this the new run-rate or a peak.

The methods line up around that question. Asset value, earnings power, and peer multiples all read the stock as richly valued, and the earnings-power family sits well below the price precisely because trailing earnings are cycle-inflated. Only the growth-based methods reach the price, which means the premium is a durability or moat premium that the static frames structurally cannot price. That is the correct reading for the lowest-cost producer in a consolidating, tariff-protected domestic market, but it is a premium nonetheless, and it depends on the cycle cooperating. The right peer set is the domestic mini-mill and steel cohort rather than integrated global producers, because Nucor's cost structure and product mix behave differently through a downturn.

Solvency is the floor under the downside, and it is solid. Net debt of about $4.5 billion runs roughly 1.4 times pre-tax operating income, interest coverage is near 20 times, and the company holds about $2.5 billion in liquid assets, so the balance sheet can carry the business through a trough without distress. The falling share count, down about 4% a year, is direct evidence of buyback deployment rather than dilution. The decisive variable is not the balance sheet but the trade-and-demand environment that sets the price per ton; the current price assumes it stays favorable, and there is limited cushion in the multiple if it does not.

Catalysts

Q1 2026 was a strong upside print. Net sales rose 21% to $9.50 billion, diluted EPS of $3.23 beat the $2.82 consensus, and net earnings reached $743 million. The steel mills segment delivered record quarterly shipments and a 14% increase in average selling price per ton, and management guided to higher consolidated earnings across all three segments in the second quarter, signaling the momentum carried into mid-year.

Trade policy is the dominant external driver, and it broke in Nucor's favor. U.S. finished-steel import share fell from over 22% in Q1 2025 to roughly 15% in Q1 2026, which management attributed to the combination of Section 232 steel tariffs and trade-remedy orders reducing foreign supply. That import relief is what allowed both volume and price to rise together, so the durability of the tariff regime is the single most important thing to track for the earnings trajectory.

Analysts moved their targets in a wide band after the quarter, reflecting the cyclicality debate. BofA raised its target to $290 from $265 with a Buy, Morgan Stanley lifted its target to $258 from $227 at Equal Weight, and Wells Fargo trimmed its target to $283 from $292 while keeping an Overweight. The next earnings print, the path of steel prices, and any change in trade policy are the events most likely to move the stock, since each feeds directly into whether the current strong earnings prove durable.

Peer Cohorts (Per Segment, With Filing Citations)

Steel Mills (reported)

Steel Products (reported)

Raw Materials (reported)

Methodology Note

Fundamentals sourced from SEC EDGAR filings. Current price from Databento. The priced-in inversion and valuation x-ray are computed by the boothcheck engine; narrative composed by AI from the structured data.

Sources

Nucor FY2024 10-K · Nucor Q1 2026 earnings release, 2026 · Nucor Q1 2026 earnings call, 2026 · analyst notes via search results, 2026

View the full interactive NUE report on boothcheck