Nucor Stock Performance Across Cycles: What Investors Should Know

The Long Game Beats the Short Trend

When evaluating Nucor Corporation (NYSE: NUE), a century-old industrial powerhouse, recent momentum can be deceiving. While shares have jumped 10.6% in the past month—and surged an additional 11.3% following strong Q3 earnings—the real story lies in how this steelmaker has performed across different investment horizons. The answer reveals a critical lesson about cyclical stocks and the power of holding quality companies through market cycles.

Five-Year Returns: The Surprise Winner

Let’s start with the longer view. Over the past five years (since December 8, 2020), Nucor stock has delivered remarkably strong performance on a total return basis, climbing 209.4% compared to the S&P 500’s 100.3%. In other words, while the broader market roughly doubled, Nucor shares more than tripled in value.

The standout year was 2021, when Nucor’s total return soared 118.4%—a period when the steel sector benefited from strong cyclical tailwinds. This five-year outperformance demonstrates that timing matters significantly in cyclical industries, and investors who stayed the course through volatility reaped substantial rewards.

Three-Year Returns: The Reality Check

Now fast-forward to the three-year picture (from December 8, 2022). Here, the narrative shifts dramatically. Investors who bought shares three years ago have seen returns of just 6.5% on an absolute basis, or 11.2% on a total return basis after accounting for dividends. Meanwhile, the S&P 500 delivered 74.4% absolute returns and 82.4% total returns during the same period.

The catalyst for underperformance came in April 2024, when Nucor issued weak guidance during its Q1 2024 earnings report. From that point forward, share prices declined throughout 2024 even as the broader market advanced. The opportunity cost for Nucor investors has been staggering—nearly 70 percentage points of underperformance compared to the index.

One-Year Returns: Slightly Behind

Zooming into the most recent 12-month period, Nucor stock has gained 11.9%, trailing the S&P 500’s one-year return of 12.6% by 0.7 percentage points. When dividends are factored in (with a current yield of 1.4%), the total return improves to 13.8%, but this still lags the S&P 500’s total one-year return of 14.3%.

What’s notable is that Nucor spent most of the year significantly underwater following a sharp share price decline in December of the prior year. Only its recent rally has brought the stock closer to market performance levels.

The Cyclical Lesson

This performance pattern across timeframes illustrates a fundamental principle: cyclical industries like steel deliver returns that depend heavily on where you sit in the economic cycle. A five-year investor who caught the industry near a trough has been rewarded handsomely. A three-year investor who entered at or near a peak has faced headwinds. A one-year investor who bought during the downturn is now seeing modest outperformance.

The data suggests that successful investing in cyclical sectors requires both conviction in quality companies and patience to weather the inevitable swings. Nucor’s track record shows that holding such positions through the long term—despite short-term underperformance—can position investors to capture meaningful gains when the cycle turns in their favor.

For traders and investors using platforms to track such plays, monitoring both the cyclical backdrop and individual stock fundamentals remains essential for timing entry and exit points effectively.