STLD Should I Buy
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Steel Dynamics Inc (STLD) is a good buy for a beginner investor with a long-term focus and $50,000-$100,000 available for investment. Despite the recent market decline, the company's strong financial performance, positive long-term sector outlook, and hedge fund interest make it a compelling choice for long-term growth.
The technical indicators show a mixed picture. The MACD is positive and contracting, suggesting bullish momentum, while the RSI is neutral. The stock is trading below its pivot level of 194.297 but above key support at 182.721. Moving averages are bullish (SMA_5 > SMA_20 > SMA_200), indicating an upward trend in the long term.
Hedge funds are significantly increasing their buying activity, up 527.06% over the last quarter.
Financial performance in Q4 2025 shows strong growth: revenue up 14%, net income up 28.34%, and EPS up 33.82% YoY.
Analysts have raised price targets recently, with the majority maintaining positive ratings.
Domestic steel mills are expected to gain market share, supporting profitability.
Recent news of potential tariff reductions has caused a decline in steel stocks.
Morgan Stanley downgraded the stock to Equal Weight, citing muted demand outlook despite elevated steel prices.
Current market price is down 5.57%, reflecting short-term bearish sentiment.
In Q4 2025, Steel Dynamics reported strong financial growth: Revenue increased by 14% YoY to $4.41 billion, Net Income rose by 28.34% YoY to $266 million, and EPS surged by 33.82% YoY to 1.82. Gross Margin also improved by 5.53% YoY to 11.83%.
Analyst sentiment is mixed but leans positive. Morgan Stanley downgraded the stock but raised its price target to $194. Other firms like KeyBanc, Jefferies, and BofA have raised price targets to $190 or higher, with some maintaining Buy ratings. The sector outlook for 2026 is cautiously optimistic, driven by domestic mills gaining market share and improved profitability.
