Steel Dynamics, Inc. (STLD) Stock Valuation — PE Analysis
Steel · NASDAQ
Current Price
$234.67
PE Ratio (TTM)
21.5x
Intrinsic Value
$208.2
-12.7% margin of safety
COMPETITIVE MOAT
↑Scale and Operational Efficiency
Steel Dynamics operates a highly efficient, low-cost production model with strategically located facilities. This scale allows for significant cost advantages and market responsiveness.
↑Integrated Scrap Recycling
The company's extensive scrap metal recycling operations provide a captive, cost-advantaged raw material source. This vertical integration insulates it from volatile raw material prices.
↑Customer Relationships and Product Diversification
STLD maintains strong relationships with a diverse customer base across various industries. Its broad product portfolio reduces reliance on any single market segment.
INVESTMENT RISKS
↓Economic Downturn Impact
A broad economic slowdown could significantly reduce demand for steel products across STLD's key end markets. This would directly affect sales volumes and profitability.
↓Regulatory and Environmental Changes
Stricter environmental regulations or trade policies could increase operating costs or limit market access. Compliance with evolving standards presents an ongoing challenge.
↓Technological Obsolescence
While STLD invests in modernization, the steel industry faces potential disruption from new production technologies or alternative materials. Failure to adapt could erode its competitive edge.
Base case
STLD base case PE valuation
At a current price of $234.67, the base case PE valuation puts STLD fair value near $208.2 per share. That figure assumes 2.3% yearly earnings growth, a target PE multiple of 21.08x, and a 10% discount rate.
Intrinsic Value
$208.2
Margin of safety
-12.7%
Expected annual return
-2.4%
Base case assumptions: 2.3% annual earnings growth, 21.08x target PE, 10% discount rate, 5 year projection. Data as of 2026-10-08.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the STLD PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Steel Dynamics, Inc. respond.
Open PE Calculator for STLDCompany Overview
Steel Dynamics, Inc. is a prominent American steel manufacturer and metal recycling enterprise, conducting its operations through three distinct business divisions. The Steel Operations segment is responsible for producing a broad range of steel products, including hot, cold, and coated rolled steel, various structural shapes like beams, channels, and angles, flat and reinforcing bars, and a diverse selection of rail and engineered steel bar products. This segment also provides specialized processing services for both bar products (such as turning, polishing, and heat treating) and specialty items (including cutting, welding, and galvanizing). Its offerings cater to numerous industries, such as construction, automotive, manufacturing, transportation, heavy and agricultural equipment, and pipe and tube production. Sales are channeled directly to end-users, steel fabricators, and service centers. The Metals Recycling Operations division focuses on acquiring, processing, and reselling ferrous (e.g., heavy melting steel, shredded scrap, cast iron) and nonferrous (e.g., aluminum, copper, stainless steel) scrap metals, transforming them into reusable materials. This division further offers supplementary services including transportation logistics, marketing, brokerage, and scrap management. The Steel Fabrication Operations segment manufactures crucial components for commercial building construction, such as steel joists, girders, trusses, and steel deck products. Established in 1993 and headquartered in Fort Wayne, Indiana, the company also engages in exporting its products internationally.
Financial Metrics — STLD PE Stock Valuation Data
PE Ratio (TTM)
21.5x
PEG Ratio
0.35
Earnings Yield
4.74%
ROE (TTM)
17.6%
Revenue/Share (TTM)
$142.24
Dividend Yield
0.88%
Debt/Equity
0.44x
Frequently Asked Questions
What is the PE ratio of STLD?
The trailing twelve-month PE ratio of STLD reflects how much investors pay per dollar of Steel Dynamics, Inc.'s earnings. This metric is most useful when compared to Steel peers and the company's own historical range.
Is STLD overvalued based on PE ratio?
STLD's PE of 21.5x combined with a PEG ratio of 0.35 provides a growth-adjusted perspective. A PEG below 1.0 means the P/E is low relative to the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Steel, a DCF analysis may be more appropriate.
How do I value STLD stock using PE ratio?
To value Steel Dynamics, Inc. using PE: (1) Compare the current PE (21.5x) against the Steel median to assess relative pricing, (2) check the PEG ratio (0.35) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of STLD?
STLD's PEG ratio is 0.35, calculated by dividing the PE ratio (21.5x) by the expected earnings growth rate. A PEG below 1.0 means the P/E is low relative to the expected earnings growth rate. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for STLD stock valuation?
PE ratio gives a quick relative read — how STLD is priced versus Steel peers. DCF provides an absolute value based on projected free cash flows. For STLD, with a strong ROE of 17.6%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See STLD DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Basic Materials valuationsP/E and DCF value STLD with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-10-08. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.