NUE
Nucor
Cyclical Commodities
★ Quality 18/100Price today
$261.07
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What this business is made of
The business
Nucor recycles scrap into steel cheaper than anyone, and survives every tide.
Nucor is the largest steel producer in the U.S. via mini-mills that melt scrap using electric arc furnaces. It sells structural steel, sheet, rebar and finished products to construction, automotive and energy; it charges the market price of steel, which rises and falls like a tide. It billed $32.5B in 2025 with a 12% gross margin.
Its edge is being the lowest-cost producer: flexible electric furnaces, a non-unionized workforce and capital discipline few can match. It's not a wide moat — steel is a commodity and no one controls the price. But in an industry where many lose money at the bottom of the cycle, Nucor survives and buys assets cheap.
Revenue history
From $36.6B to $32.5B in 4 years. Sales are shrinking — the engine is losing steam.
Where each $100 of sales goes
Revenue $32.5B · FY2025
Of every $100 in sales, $95 goes to costs and operations; $5 is left as net profit (5% margin).
Catalysts and risks
A recovery in steel prices from the 2024-2025 cyclical bottom would lift FCF fast.
Tariffs and infrastructure in the U.S. (federal spending) support domestic demand.
New plants (West Virginia, ~$3B) come online and add higher-margin capacity.
Negative FCF of -$0.2B in 2025: the cycle is clearly at its low point.
Debt of $6.9B against $2.3B cash while investing heavily in expansion.
Negative revenue CAGR (-3%): without a price tailwind, the business doesn't grow.
Charlie's note
“Paying 7.53x for the most disciplined steel producer in the U.S. is reasonable: a 12% gross margin and sales down 3% are simply the low point of the cycle, where Nucor survives while others bleed. The trick isn't the multiple, it's the patience to ride out the tide.”
Analysis · June 2026
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