Nucor Corporation expects to earn between $1.65 and $1.75 per share in the fourth quarter of 2025. This is lower than the third quarter’s earnings of $2.63 but higher than the fourth quarter of 2024, which was $1.22. The expected decline is due to seasonal changes and fewer shipping days affecting all segments of the business. In the steel mills sector, lower shipment volumes and pressure on margins, especially for sheet products, are anticipated. The steel products segment may see decreased profits from lower volumes and higher average costs per ton, though better pricing could help a bit. The raw materials segment might also struggle due to planned outages at direct reduced iron facilities.

Shareholder Returns and Market Outlook

Despite these difficulties, Nucor is focused on returning value to shareholders. The company has repurchased about 0.7 million shares at an average price of $145.23, totaling 5.4 million shares at an average of $128.66 per share in 2025. Including dividends, total returns to shareholders in 2025 are estimated at $1.2 billion. For 2026, Nucor is hopeful due to higher order backlogs, especially in construction-related markets. The company expects better market conditions supported by monetary, tax, and trade policies. It will share its fourth-quarter results on January 26, 2026. NUE shares have gone up by 27.3% in the last six months, while the industry average increase is 33.6%. NUE holds a Zacks Rank #3 (Hold), whereas companies like Commercial Metals Company, Ternium S.A., and Centerra Gold have higher rankings. With Nucor’s fourth-quarter earnings forecast already known, the market has likely adjusted for the anticipated decline. The important upcoming event is the January 26, 2026 earnings call, which will highlight the company’s positive outlook for the new year, creating opportunities for trades that focus on future growth despite current weaknesses.

Investment Approaches and Strategies

Given the strong order backlogs for 2026, a good strategy might be to use call options to bet on a positive reaction to future guidance. We can consider buying February or March 2026 call options, positioning for a potential rise in stock price after the earnings report. This moves the focus to the strong future rather than the weaker past quarter. This positive outlook is supported by recent economic data showing a slight increase in non-residential construction spending reported late in 2025. Additionally, hot-rolled coil steel futures, which dipped in autumn 2025, have begun to level off and trend slightly upward. These signals back management’s forecast of improving market conditions. However, we should be ready for potential volatility, as actual results could fall below the guidance or contain unexpected negatives. A long straddle strategy, which involves buying both a call and a put option at the same strike price and expiration date, could benefit from a significant price movement in either direction. This tactic focuses on the size of the stock movement after earnings rather than its direction. For those already holding Nucor stock, selling covered calls with a January or February 2026 expiration can generate income from the higher implied volatility before the earnings release. Historically, Nucor’s implied volatility tends to spike before earnings announcements, providing attractive premiums. This approach leverages the possibility of the stock trading sideways or slightly declining in the short term. Nucor’s significant share repurchases—5.4 million shares in 2025—provide support for the stock price. This buying pressure can help cushion against sharp drops, making strategies like selling cash-secured puts more appealing, as buybacks suggest limited downside risk. Create your live VT Markets account and start trading now.

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