Nucor Sees $2 Billion Worth of Opportunities in the Steel Industry
Nucor (NYSE: NUE), one of the largest steel companies in North America, has three priorities when it comes to using its cash flow: investing in the business, increasing its dividend, and buying back stock. Right now, Nucor has big spending plans, with over $3.5 billion worth of projects either in the works or on the drawing board. In 2020 alone it will spend $2 billion of that. Here's what Nucor is doing with all that cash, and what it means for investors.
Fiscally speaking, Nucor is a very conservative company. Relative to its closest peers it stands out for its financial strength. To put some numbers on that, its financial debt to EBITDA ratio of roughly 1.6 times is lower than that of any of its U.S. competitors, and its ability to cover interest expenses by 16 times is stronger than any company in that group. Further, the company ended 2019 with $1.8 billion worth of cash and short-term investments, and had a completely untapped line of credit worth $1.5 billion.
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Source Fool.com
