Key Takeaways
- Steel Dynamics announced Q1 EPS guidance ranging from $2.73 to $2.77, significantly missing analyst expectations of $3.24
- Shares declined 1.3% during premarket hours on Tuesday
- The forecast represents growth from Q1 2025’s $1.44 EPS and Q4 2025’s $1.82 EPS
- Order backlog has surged more than 35% year-over-year, with commitments extending through Q3 2026
- Sector peers including Nucor and Cleveland-Cliffs also declined in premarket following the announcement
Steel Dynamics (STLD) released preliminary first-quarter 2026 earnings expectations that fell significantly short of Wall Street’s projections. The steelmaker forecasted earnings per share between $2.73 and $2.77, missing the analyst consensus estimate of $3.24 and triggering a 1.3% premarket decline in shares on Tuesday.
However, context matters. The guidance shows sequential improvement from Q4 2025’s $1.82 EPS and represents substantial year-over-year growth from Q1 2025’s $1.44 per share. The company is expanding — just not at the pace Wall Street had anticipated.
Steel Dynamics attributed the quarter-over-quarter improvement to strengthening steel operations. The company anticipates increased shipment volumes combined with expanding metal spreads — where selling prices outpaced scrap input costs — to drive enhanced profitability versus the fourth quarter of 2025.
The metals recycling division is also projected to deliver improved results, benefiting from higher selling prices for both ferrous and nonferrous materials. Shipment volumes in this segment, however, are expected to decline due to weather-related disruptions during January and February.
The steel fabrication business is anticipated to deliver relatively flat performance compared to Q4, with increased shipment volumes offsetting margin compression from elevated raw material expenses.
A particularly encouraging metric: Steel Dynamics’ customer order backlog has expanded by over 35% compared to last year and extends well into the third quarter of 2026. This indicates sustained demand momentum.
The company highlighted robust demand continuing across non-residential construction markets, energy infrastructure, and automotive manufacturing.
Mississippi Aluminum Facility Update
Steel Dynamics made progress on ramping up its Columbus, Mississippi aluminum flat rolled products manufacturing facility throughout the quarter. The plant has successfully produced commercial-grade products serving the industrial segment and beverage can industry, earning product approvals from multiple can sheet customers.
Additionally, the facility has manufactured aluminum hot band for automotive industry applications — representing an important achievement as the company expands its product portfolio.
Share repurchase activity slowed temporarily in the first quarter. Capital was deployed toward the company’s annual profit-sharing distribution of approximately $126 million along with increased working capital requirements for aluminum business operations. Steel Dynamics bought back around $66 million in stock during the period and expects to resume typical repurchase levels in the second quarter.
The company has increased its dividend payment for 13 straight years. Recently, STLD announced a 6% dividend hike to $0.53 per share quarterly, with payment scheduled for early April.
Shares have climbed approximately 37% over the trailing twelve months, supported by Trump’s tariff policies on imported steel and aluminum. However, recent speculation about potential tariff reductions has created headwinds for the sector over the past month.
Broader Sector Weakness
The disappointing guidance impacted competitor stocks. Nucor (NUE) declined 0.5% in premarket trading, while Cleveland-Cliffs dropped 0.2%.
Steel Dynamics is scheduled to release complete first-quarter 2026 financial results following market close on Monday, April 20.
Regarding merger activity, Steel Dynamics and SGH Ltd. increased their combined acquisition proposal for BlueScope Steel to $11 billion — representing a 14% premium — though BlueScope declined the offer. The bidding companies have indicated they will not increase the offer further unless a rival bid materializes.
