# Steel Dynamics (STLD) Sector: Steel and metals recycling | Field | Value | |---|---| | Price | $238.99 | | Market cap | $34B | | Intrinsic value source | AI estimate | | Data as of | 2026-11-12 | | Next earnings | 2027-01-26 (estimate) | Analysts: Leaning bullish Picks: Research only Discount category: Pricey ## In short Investors pay more than the AI estimate for high US steel prices and an aluminum start-up, and only steady spreads with a profitable aluminum mill in 2027 can earn this price. ## Themes and gap - Themes: Tariffs and trade (trade-tariffs), New management (management-change) - Gap type: Slow (slow) - Why: The Q4 2026 report in January 2027 and the start of the second CASH line in early 2027 show whether steel spreads hold and aluminum turns profitable. ## About Steel Dynamics, Inc. (Steel Dynamics) is a US steel producer and metals recycler, based in Fort Wayne, Indiana. It has four segments: steel operations, metals recycling, steel fabrication and aluminum. Its mills use scrap steel as the main input. In Q3 2026, steel shipments were a record 3.8 million tons, and net sales were $6.5 billion. It is also building an aluminum flat-rolled products business, which is still in start-up. Mark Millett is Chairman and Chief Executive Officer. The board named Theresa Wagler, now Chief Financial Officer, as President and Chief Executive Officer from January 1, 2027, and Millett will become Executive Chairman. The shares trade on Nasdaq in US dollars. ## Thesis The market prices Steel Dynamics above the AI estimate, because investors expect high US steel prices to last and the aluminum business to start to earn money. In Q3 2026, net income was $756 million, or $5.26 per diluted share, against $3.69 in Q2. The average steel selling price rose $102 to $1,400 per ton, while scrap cost fell $8 to $404 per ton. The company says that imports are well below past levels and that customer inventories are low. Steel earnings swing with prices, so the price is earned only if Q3 is not a peak. For the price to be earned, four things must be true. Spreads between steel prices and scrap cost must stay wide, as the company expects through 2027. Aluminum must move from the Q3 2026 operating loss of $26 million to profit as the second CASH line starts in early 2027. Fabrication orders, which are 50% higher than a year ago, must turn into earnings. The new Chief Executive Officer must keep the capital plan, including buybacks under a new $3.0 billion authorization. The next tests are the Q4 2026 report in January 2027 and the aluminum ramp in 2027. If steel prices fall or the aluminum losses last, the price can fall toward the AI estimate. ## Checkpoints - Jan 26, 2027 (estimate): Q4 2026 results: steel spreads and aluminum. Status: Pending. Watch: Steel shipments and prices stay near Q3 2026 levels and the aluminum loss gets smaller again, and this passes; lower prices or a bigger aluminum loss fail. - Apr 2027 (estimate): Q1 2027 results: second CASH line. Status: Pending. Watch: The second CASH line runs in Q1 2027 and aluminum earns a positive operating income, and this passes; another delay fails. ## Valuation The intrinsic value for Steel Dynamics is an AI estimate from November 12, 2026. It is not an analyst's value. An AI research agent calculated it from the filings of Steel Dynamics with the SEC. Steel earnings swing with prices, so the method is a multiple of a normalized earnings per share for 2027 that the estimate sets in three cases, and each case has its own multiple. The Q3 2026 release (8-K, October 19, 2026) gives net income of $756 million, or $5.26 per diluted share, for Q3, $3.69 per diluted share for Q2, and $11.72 per diluted share for nine months, so Q1 was $2.77. Nine months annualized is $15.63 per share and Q3 annualized is $21.04 per share. The release also gives an average steel selling price of $1,400 per ton in Q3 and scrap cost of $404 per ton, and the company expects aluminum volumes and profitability to improve through 2027. The Form 10-Q for the quarter ended September 30, 2026 gives 142,217,487 shares outstanding at October 21, 2026, cash of $928.6 million and debt of $4,203.9 million. Interest on this debt is already in net income, so the estimate makes no debt adjustment. The 2027 EPS and the multiples are assumptions. The low case assumes $12.00, which is below the nine-month rate because steel prices fall back, at 9 times. It gives $108.00 per share. The base case assumes $17.50, which is between the nine-month rate and the Q3 rate, at 11.5 times. It gives $201.25 per share. The high case assumes $22.00, which is about the Q3 rate, because prices hold and aluminum turns profitable, at 13 times. It gives $286.00 per share. The estimate assumes weights of 25%, 50% and 25%. The weighted intrinsic value is $199.13 per share. As of 2026-11-12. Sources: - https://www.sec.gov/Archives/edgar/data/1022671/000110465926117217/tm2627861d2_ex99-1.htm - https://www.sec.gov/Archives/edgar/data/1022671/000110465926118461/stld-20260930x10q.htm ## Balance sheet - Cash: $929M - Debt: $4.2B - Net debt: $3.3B - Undrawn credit line: $1.2B, to July 2028 - Debt due within 12 months: $21M At September 30, 2026, Steel Dynamics had cash of $928.6 million and debt of $4,203.9 million, of which $20.9 million falls due within 12 months. Total debt of $4.2 billion was unchanged from December 31, 2025. Long-term debt was 30% of capitalization, against 32% at the end of 2025. The company has a $1.2 billion revolver that matures in July 2028, and liquidity was $2.4 billion. In nine months, cash flow from operations was $1.4 billion, capital investments were $411.4 million, dividends were $225 million and share buybacks were $591 million. Interest expense was $111.7 million in nine months, up 159%. As of 2026-09-30. Sources: - https://www.sec.gov/Archives/edgar/data/1022671/000110465926118461/stld-20260930x10q.htm - https://www.sec.gov/Archives/edgar/data/1022671/000110465926117217/tm2627861d2_ex99-1.htm ## Dividends - Dividend yield: 0.9% (last 12 months, at the current price) - Paid per share, last 12 months: $2.09 (4 payments) - Current annual rate: $2.12 ($0.53 x 4 a year) - Payout ratio: 25% of the earnings of the last fiscal year (the year ended 2025-12-31) - Latest ex-dividend date: 2026-09-30, $0.53 per share - Growth from 2020 to 2025: 14.9% a year - Growth from 2015 to 2025: 13.7% a year Dividends per share by year: 2016: $0.56, 2017: $0.62, 2018: $0.752, 2019: $0.96, 2020: $1.00, 2021: $1.04, 2022: $1.36, 2023: $1.70, 2024: $1.84, 2025: $2.00. Source: company filings and market data, read on 2026-11-13. ## Recent events - 2026-11-09: Steel Dynamics added a $3.0 billion share repurchase authorization, on top of $216 million left on its earlier program at September 30, 2026. It also declared a quarterly dividend of $0.53 per share, payable on or about January 8, 2027. - 2026-10-23: In its Q3 10-Q, Steel Dynamics said that its debt of $4.2 billion was unchanged from December 31, 2025, and that cash was $928.6 million. It had 142,217,487 shares outstanding at October 21, 2026. - 2026-10-19: Steel Dynamics reported Q3 2026 results. Net sales were $6.5 billion, operating income was $1.0 billion, net income was $756 million, and adjusted EBITDA was $1.2 billion. Cash flow from operations was $846 million. The company bought back $276 million of shares. - 2026-10-19: Steel Dynamics said that its aluminum business had an operating loss of $26 million in Q3 2026, 21% less than in Q2, and was at EBITDA breakeven. All three cold mills run. The first CASH line runs, and the second line should start early in Q1 2027. - 2026-08-03: Steel Dynamics said that Mark Millett will retire as Chief Executive Officer on January 1, 2027, and become Executive Chairman. Theresa Wagler, the Chief Financial Officer, will become President and Chief Executive Officer. ## Latest news and filings - Last earnings: 2026-10-20 (8-K: https://www.sec.gov/Archives/edgar/data/1022671/000110465926117217/) - Next earnings: 2027-01-26 (expected; the company has not confirmed it) | Filed | Form | Headline | Period end | XBRL document | Link | | --- | --- | --- | --- | --- | --- | | 2026-11-10 | 8-K | Other company news | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926125064/tm2629447d1_8k.htm | | 2026-10-23 | 10-Q | Quarterly report for the period ended Sep 30, 2026 | 2026-09-30 | stld-20260930x10q | https://www.sec.gov/Archives/edgar/data/1022671/000110465926118461/stld-20260930x10q.htm | | 2026-10-20 | 8-K | Earnings release | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926117217/ | | 2026-10-19 | 8-K | Other company news | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926116898/tm2627861d1_8k.htm | | 2026-09-18 | 8-K | Investor disclosure | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926108777/tm2625690d1_8k.htm | | 2026-08-14 | 8-K | Other company news | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926096861/tm2623292d1_8k.htm | | 2026-08-04 | 8-K | Change of directors or officers and Investor disclosure | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926090129/tm2622182d1_8k.htm | | 2026-07-28 | 10-Q | Quarterly report for the period ended Jun 30, 2026 | 2026-06-30 | stld-20260630x10q | https://www.sec.gov/Archives/edgar/data/1022671/000110465926087414/stld-20260630x10q.htm | | 2026-07-21 | 8-K | Earnings release | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926085277/ | | 2026-06-18 | 8-K | Investor disclosure | | | https://www.sec.gov/Archives/edgar/data/1022671/000110465926075470/tm2618235d1_8k.htm | Every filing on SEC EDGAR (CIK 1022671): https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001022671&type=&dateb=&owner=include&count=40 ## Risks - High: Steel prices are cyclical. Steel operations earned $2.3 billion of operating income in nine months of 2026, and Q3 may be a high point. If imports return or demand falls, profit can fall fast. - High: The aluminum start-up has cost much and is not yet profitable. Output in Q3 2026 was less than expected because of yield losses, and the company still has capital to spend on the second CASH line and a slab center. - Medium: New domestic steel and aluminum capacity may enter the market in the coming years, as the company says. More supply can lower prices and spreads. - Medium: Trade rules can change. The company says that recent trade actions lowered imports of coated flat-rolled steel. A change in these rules would change prices. - Medium: A new Chief Executive Officer takes over on January 1, 2027, together with several new senior leaders in operations. A mistake in capital plans or operations would cost money. ## Links - Page: https://picks.utilarium.app/company/STLD/ - History of changes: https://picks.utilarium.app/company/STLD/history/ - JSON with full history: https://picks.utilarium.app/data/company/STLD.json > Picks is a personal record of stock picks. It gives general opinions about stocks, including a "Top pick" label. They are not tailored to your needs, goals or risk tolerance. Kevin is not a registered adviser and relies on the general-advice exemption in Canadian securities law (NI 31-103 s.8.25). Do your own research, or ask a registered adviser. Kevin may hold any stock on this site. Prices, intrinsic values and ratings can be delayed or wrong; check the original source. Full disclaimer: /disclaimer/.