>>> Steel Dynamics, Inc. (STLD), together with its subsidiaries, operates as a steel producer and metal recycler in the United States. It operates through three segments: Steel Operations, Metals Recycling Operations, and Steel Fabrication Operations. The Steel Operations segment offers hot roll, cold roll, and coated steel products; parallel flange beams and channel sections, flat bars, large unequal leg angles, and reinforcing bars, as well as standard strength carbon, intermediate alloy hardness, and premium grade rail products; and engineered special-bar-quality products, merchant-bar-quality products, and other engineered round steel bars. The company also engages in turning, polishing, straightening, chamfering, threading, precision saw-cutting, and heat treating of bar products; and cutting to length, straightening, hole punching, shot blasting, welding, galvanizing, and coating of specialty products. Its products are used in construction, automotive, manufacturing, transportation, heavy and agriculture equipment, and pipe and tube markets. This segment sells directly to end-users, steel fabricators, and service centers. The Metals Recycling Operations segment purchases, processes, and resells ferrous and nonferrous scrap metals into reusable forms and grades. Its ferrous products include heavy melting steel, busheling, bundled scrap, shredded scrap, steel turnings, and cast-iron products; and nonferrous products comprise aluminum, brass, copper, stainless steel, and other nonferrous metals. This segment also provides transportation logistics, marketing, brokerage, and scrap management services. The Steel Fabrication Operations segment produces non-residential steel building components, such as steel joists, girders, trusses, and steel deck products. The company also exports its products. Steel Dynamics, Inc. was incorporated in 1993 and is headquartered in Fort Wayne, Indiana. <<<
Steel Dynamics is a fast-growing steelmaker that is following a well-honed playbook.
1. Steel Dynamics: Smaller, but growing faster
Steel stocks are extremely expensive today, as they put up record-breaking results. That includes Steel Dynamics ( STLD 8.07% ), which is a relative newcomer compared to industry giant Nucor and iconic United States Steel.
That said, the company's production is built on electric arc mini-mills (like Nucor's fleet) that are more flexible than blast furnaces, which are a big piece of U.S. Steel's business. This is an important distinction because Nucor has long been the industry's leading name.
So why not buy Nucor in a sell-off? Well, you could, and you'd likely be happy doing so. But Steel Dynamics was co-founded by an ex-Nucor employee and uses its "stepsister's" playbook to a large degree. However, with a market cap of around $14 billion, it is less than half the size of Nucor. That means it takes less investment to move the top and bottom lines significantly. And this in turn gives Steel Dynamics a stronger growth outlook.
One place where that's shown up is on the dividend front, where Steel Dynamics' dividend has grown at an annualized clip of roughly 10% over the past decade, compared to the low-single-digit annualized dividend growth at Nucor over the same time span.
If you are on the lookout for a steel name and are focused on dividend growth, Steel Dynamics is probably the best name for your bear market wish list.