Nucor (NUE): Assessing Valuation After Buffett-Style Interest and U.S. Infrastructure Tailwinds

Recent commentary spotlighting Nucor (NUE) as a textbook fit for Warren Buffett’s earnings and valuation playbook, tied to ongoing U.S. infrastructure spending, has pushed the stock back into the conversation for long term investors.

See our latest analysis for Nucor.

That backdrop seems to be resonating with investors, with Nucor’s share price rallying 24.9% over the past three months to around $169.40. Its one year total shareholder return of roughly 49% reinforces that momentum is still building rather than fading.

If Nucor’s run has you thinking about where else strong demand themes could show up, this is a good moment to explore aerospace and defense stocks as another potential hunting ground.

With Nucor’s earnings still growing, a strong multi year track record, and the stock now hovering near analyst targets, the key question is whether today’s price offers upside or already reflects the next leg of growth.

Most Popular Narrative Narrative: 4.3% Undervalued

With Nucor last closing at $169.40 versus a narrative fair value near $177, the current setup implies modest upside if its long term plan lands.

Nucor's significant capital reinvestment of $860 million, with two-thirds directed towards projects commencing operations within two years, is expected to diversify and strengthen future earnings. This impacts revenue and net margins through enhanced production capacity and efficiencies.

Read the complete narrative.

Curious what kind of revenue runway and profit profile could justify that higher value, even with a lower future earnings multiple baked in? The full narrative unpacks an aggressive earnings trajectory, margin rebuild and share count shift that together paint a very different picture from Nucor’s recent headline profit declines.

Result: Fair Value of $177.08 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, this upside depends on steel demand holding up, as macro slowdowns or project execution issues could potentially derail the earnings and margin rebuild.

Find out about the key risks to this Nucor narrative.

Build Your Own Nucor Narrative

If this view does not fully align with your own take, or you prefer hands on research, you can build a custom story in minutes: Do it your way

A great starting point for your Nucor research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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