Expect Nucor To Benefit From President-Elect Trump's Infrastructure Spending Plan

Election Result, Housing Market: Twin Catalysts

Analyst David Coleman noted that the shares of Nucor, which declined in late October in reaction to its disappointing third quarter results, have rallied along with other steel stocks since the November 8 election. Additionally, the analyst sees the company benefiting from the strength in the U.S. housing market.

Argus believes the company can counter the potential fourth-quarter weakness stemming from lower margins in the steel mills segment by the strength in the U.S. housing market, which accounts for 65 percent of the company's revenues. The company also expects a loss in its raw materials segment due to lower transfer prices at direct-reduced iron facilities, the firm noted. Accordingly, the company predicted a sequential decline in fourth-quarter earnings.

Argus estimates earnings of $2.39 per share for 2016 and $2.99 per share for 2017.

Maintaining Rating, Upping Price Target

Argus maintains its Buy rating on the shares of the company, while it upped its price target to $65 from $58. The firm continues to view the company as a best-in-class steel manufacturer.

At last check, Nucor was down 0.59 percent at $59.10.