Navigating Market Shifts: Steel Dynamics' Q4 Profit Outlook
Steel Dynamics Projects Reduced Q4 Profitability
Steel Dynamics, Inc. has issued its financial outlook for the fourth quarter of 2025, forecasting diluted earnings per share to be between $1.65 and $1.69. This projection falls short of analyst expectations, which had estimated earnings around $2.15 per share. The anticipated figures represent a decrease from the third quarter of 2025's $2.74 per share but an increase compared to the $1.36 per share reported in the fourth quarter of 2024.
Factors Contributing to Decreased Steel Operations Profit
The primary drivers behind the expected dip in quarterly steel operations' profitability are a reduction in average selling prices and decreased sales volumes. These factors are largely attributed to the typical seasonal slowdown in demand and extensive maintenance shutdowns at the company's flat-rolled steel facilities, which led to an estimated production loss of 140,000–150,000 tons. Hot-rolled steel prices experienced a notable decline of over $70 per ton between July and October 2025, impacting sequential selling values due to the delayed effect of commercial pricing agreements. However, there has been a recent resurgence in flat-rolled steel prices, fueled by a reduction in import volumes and consistent underlying market demand.
Expected Declines in Other Segments and Future Outlook
Beyond steel production, Steel Dynamics also anticipates a sequential decline in earnings from its metals recycling and steel fabrication divisions. This is primarily due to seasonal reductions in shipments, additional maintenance activities, and a drop in scrap metal prices. Despite these challenges, the company's future prospects appear promising, with a strong order book extending into the second quarter of 2026. This is complemented by an expected increase in demand driven by infrastructure projects, domestic manufacturing growth, and a more favorable interest rate environment, all of which are poised to bolster sales volumes in 2026.
Recent Financial Milestones and Share Repurchase
In the third quarter, Steel Dynamics surpassed market expectations, reporting revenues of $4.83 billion against an analyst consensus of $4.80 billion, and earnings per share of $2.74, exceeding the estimated $2.64. The company has also been active in managing its capital, repurchasing approximately $200 million, or 1%, of its common stock during the fourth quarter of 2025. Investors are keenly awaiting the official release of the fourth-quarter earnings report, scheduled for January 26, 2026.
Analyzing the Stock's Technical Performance
Steel Dynamics' stock (STLD) exhibits a robust technical posture, trading above its key moving averages, which suggests a bullish trajectory. The 20-day Simple Moving Average (SMA) is positioned above the 50-day SMA, reinforcing this upward momentum. With a Relative Strength Index (RSI) of 59.57, the stock is in neutral territory, implying there is still potential for growth before it enters overbought conditions. Conversely, the Moving Average Convergence Divergence (MACD) is currently below its signal line, hinting at some short-term bearish pressure. Key support for the stock is identified at $164.00, while resistance lies at $173.00. A "golden cross" observed in June, where the 50-day SMA surpassed the 200-day SMA, historically signals a shift to a long-term bullish phase. Over the past year, the stock has delivered an impressive 44.50% return, reflecting strong investor confidence. Currently, STLD is trading at 96.0% of its 52-week peak, underscoring its proximity to yearly highs, with shares recently closing at $171.00, up 1.11% on Wednesday.