Based in Fort Wayne, Indiana, Steel Dynamics, Inc. (STLD) is a steel producer and metal recycler. Valued at a market cap of $17.7 billion, the company makes and markets steel products, processes and sells recycled ferrous and nonferrous metals and fabricates, and sells steel joist and decking products.

Companies worth more than $10 billion are generally labeled as “large-cap” stocks, and Steel Dynamics fits this criterion perfectly. The company distinguishes itself as one of the leading steel producers and metal recyclers in the U.S. It is renowned as one of the most diversified steel companies offering a vast range of specialty products.

Shares of STLD are trading 25.4% below their 52-week high of $151.34, which they hit on Apr. 1. The steel company’s stock has declined 6.5% over the past three months, significantly lagging behind the broader Dow Jones Industrials Average’s ($DOWI) 7.8% gain over the same time frame.

In the longer term, STLD stock is down 4.5% on a YTD basis, lagging behind DOWI’s 10.4% gains. Shares of STLD have gained 14.3% over the past 52 weeks, underperforming DOWI’s 20.2% returns over the same time frame.

To confirm its bearish trend, STLD has been trading below its 200-day and 50-day moving average since early August.  

On Jul. 17, Steel Dynamics reported its Q2 earnings report. It reported a second-quarter profit of $428 million, or $2.72 per share, surpassing Wall Street expectations of $2.67. The company also beat revenue forecasts, posting $4.6 billion compared to the expected $4.4 billion. However, the stock declined for six consecutive trading sessions despite exceeding market expectations.

Highlighting the contrast in performance, STLD has outpaced its rival Nucor Corporation (NUE), which declined 7.8% over the past 52 weeks and 17.7% on a YTD basis.

Given that STLD has underperformed the broader market, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from 11 analysts in coverage, and the mean price target of $135.60 suggests a 20.2% premium to its current levels. 

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