Nucor ( NUE 0.88% ) stock has recently surged, helping shares of North America's largest steelmaker far outpace the S&P 500 's ( ^GSPC 1.07% ) return thus far in 2025. Nucor stock has jumped 15% since it reported strong third-quarter results, bringing its year-to-date return to 42.8% (versus the S&P 500's 17% gain).

Steel is a cyclical sector, and several catalysts could propel Nucor stock even higher through the cycle. However, there are also factors that investors should consider before investing in the steel sector at this time.

Big projects are planned

A construction cycle is beginning to boost the steel sector. In its third-quarter earnings call , Nucor management highlighted "high-growth markets, like data center construction" as an ongoing catalyst for its busine

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