Earnings Preview: Nucor seen posting 2Q growth

OVERVIEW: During the quarter, Charlotte, N.C.-based Nucor bought Metal Recycling Services Inc. and Galamba Metals Group for undisclosed terms. Galamba, of Kansas City, Mo., processes more than 500,000 tons annually. Metal Recycling Services, of Monroe, N.C., processes 220,000 tons annually.

In June, Nucor said it would pay about $185 million to buy Auburn, Ind.-based Ambassador Steel Corp., which makes steel rods and bars, and its Delta Erecting Inc. affiliate.

In May, Nucor announced it bought a 50 percent stake in a venture with Italy's Duferco SA to produce steel beams and a 34 percent stake in a venture with Greece's Sidenor SA to make produce long steel products and plate.

Also in May the company said it applied for a permit to build a $2 billion iron-making plant in southeastern Louisiana.

Nucor raised about $2.3 billion in an offering of 27.7 million shares in May. It also said it planned to sell $1 billion in bonds at an as-yet unspecified date.

BY THE NUMBERS: Citing strong shipments and higher margins, Nucor last month raised its second-quarter earnings-per-share estimate to a range of $1.75 to $1.80, from a previous forecast of $1.55 to $1.60 per share.

Analysts polled by Thomson Financial expect earnings per share of $1.80.

In the second quarter of last year, Nucor earned $1.14 per share.

ANALYST TAKE: Goldman Sachs analyst Aldo Mazzaferro said on June 8 that he expects Nucor to post second-quarter earnings per share of $1.90. He said Nucor should "benefit from rising metal spreads as steel prices are rising faster than the input costs."