If Trump Lowers Steel Tariffs, Is Nucor Still a Buy?

Core Viewpoint - Nucor has experienced significant stock gains due to steel tariffs, but potential reductions in these tariffs by the Trump administration could impact its future performance and competitiveness in the market [1]. Group 1: Nucor's Performance - Nucor's stock has increased by 41% over the past 12 months and 16% year-to-date in 2026, benefiting from tariffs that have reached up to 50% [1]. - The company has maintained 210 consecutive quarterly dividend payments and has a strong cash position of $5 billion, supporting buybacks and expansion efforts [1]. Group 2: Tariff Changes - Trump is considering scaling back tariffs on steel and aluminum, which could include exemptions for certain products and a pause on expanding tariff lists [1]. - The rationale for these changes includes rising consumer prices and political pressures ahead of midterm elections, with 59% of Americans disapproving of Trump's handling of rising costs [1]. Group 3: Implications for the Steel Industry - Lower tariffs may expose U.S. steel producers to increased competition from imports, potentially affecting prices and profit margins [1]. - Steel imports saw a decline of 12.2% in 2025, with expectations of continued decreases into early 2026 [1]. - Despite potential challenges, demand from sectors like data centers and infrastructure projects may provide some support for the steel market [1]. Group 4: Investor Sentiment - Warren Buffett's recent purchase of 6.6 million shares of Nucor for approximately $850 million reflects confidence in the company's fundamentals, despite potential short-term uncertainties due to tariff changes [1]. - Nucor's efficient production methods and focus on high-margin areas, including green steel initiatives, position it favorably for long-term growth [1].