Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Buy NUE @ $36.25

Nucor Corp is a steel maker and recycler. Their segments are: Steel Mills, Steel Products, and Raw Materials. It is a basic materials sector stock, which is a highly cyclical sector. The price is averaging $40 per share since October 2008 and with any dips it can reach the 4% yield point of $36.25, based on current dividend of $1.45.

 

EPS growth 2011-2012

EPS 2010

EPS 2011

EPS 2012

EPS 2013

Price 7/29/2011

4% yield

40.30%

$0.44

$2.68

$3.76

$4.24

$38.89

$36.25

Click to enlarge

 

NUE is a Dividend Champion with 38 years of consecutive dividend increases, through crashes and high times. The 5-year dividend growth rate is 36.9%, while the dividend growth rate last year was only 2.1%. The ttm p/e ratio is 26.28, but current p/e is 14.62 and forward p/e for 2012 is 10.37.

 

One must watch out in a cyclical industry for the crash, like May 2008. However, dividend yield can be good when purchased at the 4% yield point. The company has only 48.8% debt to total assets ratio.

Click to enlarge