What to do about Nucor

The Steel industry in the past few years has been doing very well. I suppose this is most likely due to the increasing industrialisation of countries such as China and India in addition to the American War in Iraq. Both categories require Steel for the production of building infrastructures as well as automobiles. I believe this is true due to steel prices in the United States, which has stayed level even though demand in the United States has weakened. This suggests that there is demand elsewhere that is making up for the lower demand of the States.

Nucor does not seem to have much speculation in the stock, based on its large size and its relatively stable P/E ratio of about 12. Assuming that the slowdown of the United States economy does not greatly damage industrialisation of developing countries, the Steel industry on average will show higher profits. Nucor currently at a price of 74.80 is too much higher than I would value it, assuming that its 5-year performance maintains.