NUE - Nucor Steel Dynamics fall amid new short idea at Hedgeye
2023-03-13 11:12:50 ET
- Nucor ( NYSE: NUE ) fell 1.4% and Steel Dynamics dropped 2.4% amid a new short idea from Hedgeye, which argues that the optimism over domestic steel and related industries appears to be overdone.
- "Base metals have been deeply cyclical for decades and, most likely, centuries," Hedgeye analyst Jay Van Sciver wrote in a note on Monday. "We think all of the bullish catalysts will fail, once again, in the face of `the cycle.’ Construction and consumption drive demand, with higher rates and tighter credit an inevitable dampener. Credit tightening, more expensive borrowing, and inflationary/supply pressures limit the upside in total construction spending."
- Hedgeye's Van Sciver sees 50% downside for shares of Nucor ( NUE ), Steel Dynamics ( NASDAQ: STLD ) and Commercial Metals Co. ( CMC ) "as as investors become reacquainted with the industry’s global character, fleeting cost spreads, pervasive cyclical character." Commercial Metals fell 2.4%.
- Earlier this month Nucor raised sheet steel by $150/ton, latest in pattern of price hikes.
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Nucor, Steel Dynamics fall amid new short idea at Hedgeye