Steel stock is an easy buy

Nucor just reported a great quarter, boasts a high yield and has catalysts galore.

By Jim Cramer Oct 21, 2011 9:02AM

the streetOccasionally a stock comes along that's easy. Nucor (NUE) is that kind of stock.

 

The company reported a terrific quarter, showing great growth at a time when every other steel company has had its head handed to it. The balance sheet is its best in years. Its exports, while small, are starting to spurt. Raw costs are coming down as the bidding-up of scrap subsides.

 

Further, the business is no longer as leveraged to nonresidential construction, as it is recognized by management that such construction -- which is 60% below where it was in 2007 -- isn't coming back anytime soon. Autos are playing a bigger and bigger role, and the auto business is thriving. Plus it offers a bountiful yield with a dividend that has been boosted for 37 years and is about to be boosted again. 

 

Beyond that, there's a huge kicker: the election. The Senate passed a bill Tuesday that, should it progress into law, would drastically cut imports from China. That would be hugely bullish for Nucor.

 

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President Barack Obama is trying to get something done, but he doesn't want a trade war. The Republicans don't mind taking the trade war, because they -- like Dan Dimicco, one of my favorite CEOs -- acknowledge we have been in a losing one with the Chinese for years. So 2012 will be a year full of good headlines for steelmakers.

 

To me, Nucor is a stock that must be bought -- especially on the down days, when there are rarely any bids for industrials because of the horrendous sell and double-sell programs. It is a terrific stock to be in, with catalysts galore.

 

Nucor? Bingo.

 

At the time of publication, Cramer had no positions in the stocks mentioned.

 

jim cramer
Jim Cramer
is a co-founder of TheStreet and contributes daily market commentary to the financial news network's sites. Follow his trades for his charitable trust.

6Comments
Oct 21, 2011 12:42PM
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Nucor??..........same 'material's category as Alcoa??  That stock hasn't done anything either....
Oct 21, 2011 1:29PM
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This is why I don't bother watching CNBC anymore.   It's become a shallow reporting pretty graphics distraction.   I don't need someone to tell me the Dow is up or down every 5 minutes and then show E-Trade ads the rest of the day.

As for this story, Cramer is corrupt.  Some CEO comes by and tickles his winki and he's all buy buy buy.       I doubt Cramer can read a balance sheet much less notice how most books on wall street are cooked with sales of assets to meet estimates at an end of a quarter, etc.

Note he owns none of the stock.   If it's a buy then put your money where your mouth is Cramer.
Oct 21, 2011 1:07PM
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beware,the shyster adores the ceo of nucor. in the past he has had him on the show

and the stock has subsequently tanked.one time the ceo ensured the dividend and cramer

chirped about the holy high yield       only to have the dividend cut and the stock plummet

DO NOT BE DUPED BY THE FRONT RUNNING SHYSTER

Oct 21, 2011 10:30AM
Oct 21, 2011 1:09PM
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AEM, AA ,NYX,UNH,     look for yourself   DONT BE DUPED BY THE GYPSY
Oct 21, 2011 10:49AM
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Mr. Cramer...what is your outlook for Allegheny Technologies Inc. since you have such high regard for Nucor?
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