Steel Dynamics, Inc. (STLD)

(A Top Pick May 19/22, Down 10.3%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with STLD has triggered its stop at $68. To remain disciplined, we recommend covering the position at this time. This will result in a next investment gain of 1%, when combined with previous buy recommendations.

Stockchase Research Editor: Michael O'Reilly STLD is expected to benefit from the trend towards "onshoring" -- security of supply for key infrastructure -- and is again reiterated as a TOP PICK. As one of the largest US steel producers, it will also benefit from the Biden Administration infrastructure focus to easy supply chain delays and boost automobile production. It trades at 4x earnings, compared to peers at 10x. Most recent earnings again beat analyst expectations and supports a ROE of 70%. Its cash reserves are relatively unchanged, while it aggressively buys back shares and retire debt early. We continue to recommend a stop loss at $68, looking to achieve $101.50 -- upside potential over 30%. Yield 1.81% (Analysts’ price target is $101.50)

(A Top Pick Feb 15/22, Up 45.9%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with STLD is progressing well. We now recommend trailing up the stop (from $58) to $68 at this time.

(A Top Pick Feb 15/22, Up 19.3%)Stockchase Research Editor: Michael O’Reilly Our PAST TOP PICK with STLD has achieved its $75 objective. To remain disciplined, we recommend covering half the position and trailing up the stop (from $50) to $58.

Stockchase Research Editor: Michael O'Reilly We again reiterate STLD, one of the largest steel producers and metal recyclers in the US, as a TOP PICK. The company expects the pandemic related supply-chain challenges in the auto sector to subside this year, supporting stronger production of vehicles. Growth is expected in the construction and industrial sectors as well as the current Administration bolsters infrastructure spending. The company trades at 4x earnings compared to peers at 17x. It pays a smallish dividend, backed by a payout ratio of under 15% of cashflow. We continue to recommend a stop loss at $50, looking to achieve $75 -- upside potential over 18%. Yield 1.69% (Analysts’ price target is $74.77)

Stockchase Research Editor: Michael O'Reilly As one of the largest steel producers and metal recyclers in the US, we reiterate STLD as a TOP PICK. A move by the current Administration to bolster infrastructure spending is expected to help create record earnings as management guidance was boosted. Domestic steel demand from the automotive, construction and industrial sectors is expected to remain strong. The company bought back over $1 in stock this year. It trades at 5x earnings compared to peers at 16x and has a PEG ratio under 0.5, showing good value here. It pays a decent dividend, backed by a payout ratio of under 15% of cashflow. We continue to recommend a stop loss at $50, looking to achieve $79 -- upside potential over 25%. Yield 1.69% (Analysts’ price target is $78.77)

Stockchase Research Editor: Michael O'Reilly STLD is one of the largest steel producers and metal recyclers in the US. A move by the current Administration to bolster infrastructure spending will add further upside opportunity. It trades at 9x earnings compared to peers at 20x and has a PEG ratio under 0.5, showing good value here. It pays a decent dividend, backed by a payout ratio of under 20% of cashflow. We would buy it with a stop loss at $50, looking to achieve $75 -- upside potential over 19%. Yield 1.65% (Analysts’ price target is $74.22)