Who has some scrap metal to turn into cash? Let’s recycle it and use the cash to buy shares of Nucor (NUE). It is a good week in the stock market. We are about 5% up from the recent 52-week low we put in. That is making buying stocks on a down day a bit harder. When we get shares on sale, we can buy more. However, we are still below the 52 week high.
Nucor (NUE) is our best in breed steel company. They make and sell steel. They also use a lot of scrap metal in their process. So when the price of steel goes down, their cost of goods goes down also. This is a good way to protect profits when the market for steel goes down.
Another big benefit to shareholders and employers is the profit-sharing at the company. They share 10% of profits with employees and their current 401k match goes from 5% to 25%, depending on profits. This benefit employees, because they can make more money when the company does good. This is also good for me, the shareholder. With profit-sharing, I believe employees will care more about profits and reducing waste, because it affects their paychecks. And when times are not good, employee cost go down. Having a company culture that moves cost with revenues is awesome.
If you take care of the employee, they will take care of the customer, and they will take care of the profits. I like investing in a company that has a system in place that will stand the test of time. Proof of concept is the 30 years of no layoffs for lack of work and the 42 years of increasing their dividend payment, which is very impressive. This is especially impressive since they are in the steel making industry, they have to worry about foreign countries dumping steel, and the bust and boom cycles of steel.
With these benefit, I have less need to worry about next year steal price, catalyst to increase share price, and many other factors for the short-term. In fact, with their great dividend, I would like to own this for decades. So I bought 7 shares for $287.55 with a dividend payment of $10.50 a year. Plus, the share price is down 1.7% from yesterday, saving a little bit of money. With the current track record, this should increase in the future. This is how we are turning scrap metal into dividends.