Download PDF

1. Company Snapshot

1.a. Company Description

Reliance Steel & Aluminum Co. operates as a diversified metal solutions provider and the metals service center company in the United States, Canada, and internationally.The company distributes a line of approximately 100,000 metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel, titanium, and specialty steel products; and provides metals processing services to general manufacturing, non-residential construction, transportation, aerospace, energy, electronics and semiconductor fabrication, and heavy industries.It also distributes non-ferrous metals products and tubular building products; and manufactures specialty extruded metals, fabricated parts, and welded components.


As of December 31, 2021, the company operated a network of approximately 315 locations in 40 states in the United States and 13 in other countries.It sells its products directly to original equipment manufacturers, which primarily include small machine shops and fabricators.The company was founded in 1939 and is headquartered in Los Angeles, California.

Show Full description

1.b. Last Insights on RS

Reliance Steel & Aluminum Co.'s recent performance was negatively impacted by lower selling prices, which pressured margins despite higher revenues. The company's Q2 earnings missed estimates, coming in at $4.43 per share versus the expected $4.72 per share. Additionally, the company's medical care ratios increased, which may have contributed to the earnings miss.

1.c. Company Highlights

2. Reliance Inc. Posts Mixed 2025 Results Amidst Challenging Macroeconomic Backdrop

Reliance Inc. reported a 6.2% increase in tons shipped in 2025, resulting in record tons sold of 6.4 million, outperforming the industry by over 7 percentage points. However, the company's full-year 2025 earnings per diluted share declined 10.2% from 2024 to $2.4, missing analyst estimates of $2.8. The FIFO gross profit margin improved by 90 basis points in 2025 compared to 2024, driven by strong pricing discipline, mainly on increased mill prices for carbon products. Revenue growth is expected to be 1.6% next year.

Publication Date: Feb -20

📋 Highlights
  • Market Share Growth: Reliance's U.S. market share rose to 17% in 2025 from 15% in 2024, outpacing industry growth.
  • Record Tons Sold: Achieved 6.4 million tons sold in 2025, a 6.2% increase driven by carbon product demand.
  • FIFO Margin Expansion: FIFO gross profit margin improved 90 basis points to 29–31% annual range, aided by pricing discipline on carbon products.
  • Operating Cash Flow: Generated $831 million in 2025 operating cash flow, funding $200 million in stock repurchases and $64 million in dividends.
  • 2026 CapEx Plan: Capital expenditure budget set at $275 million to maximize returns on prior investments and support long-term growth.

Operational Highlights

Reliance increased its U.S. market share to approximately 17% in 2025 from 15% in 2024, driven by strong operational execution and continued market share gains. The company was successful in winning new business and better leveraging its operating expenses over higher volumes, leading to increased FIFO profits. As Karla Lewis, President and CEO, noted, "We're positive on 2026 based on the quoting activity we're seeing right now, and we're seeing good activity on the carbon side, which is the majority of our volume."

Cash Flow and Capital Allocation

Reliance generated $831 million in operating cash flow in 2025, which it redeployed into high-value initiatives, including investments in advanced processing equipment and other projects that support long-term growth objectives. The company is announcing a capital expenditure budget of $275 million for 2026, focusing on maximizing returns on significant capital deployed in recent years. The company's strong cash flow generation is reflected in its Free Cash Flow Yield of 3.87%.

Valuation and Outlook

With a P/E Ratio of 23.05 and an EV/EBITDA of 14.24, Reliance's valuation multiples suggest that the market is pricing in a certain level of growth and profitability. The company's ROE of 10.27% and ROIC of 8.16% indicate a relatively strong return on equity and invested capital. As the company expects its gross profit margin to improve in 2026, with a guidance range of 29% to 31%, it is well-positioned to capture market share and accelerate growth as markets stabilize and improve.

3. NewsRoom

Card image cap

Aquatic Capital Management LLC Purchases 24,502 Shares of Reliance, Inc. $RS

Mar -16

Source: defenseworld.net

Card image cap

RS Unit Clinches Multi-Billion U.S. Infrastructure, Defense Deals

Mar -12

Source: zacks.com

Card image cap

Reliance, Inc. Subsidiary AMI Metals, Inc. Awarded Significant Government Infrastructure and Defense Projects

Mar -10

Source: globenewswire.com

Card image cap

Dynamic Technology Lab Private Ltd Takes Position in Reliance, Inc. $RS

Mar -09

Source: defenseworld.net

Card image cap

Here's Why You Should Retain Reliance Stock in Your Portfolio

Mar -04

Source: zacks.com

Card image cap

111 Capital Takes $522,000 Position in Reliance, Inc. $RS

Mar -03

Source: defenseworld.net

Card image cap

Reliance (NYSE:RS) & Energizer Resources (OTCMKTS:NSRCF) Critical Analysis

Mar -03

Source: defenseworld.net

Card image cap

Reliance, Inc. (RS) Presents at 35th BMO Global Metals, Mining & Critical Minerals Conference Transcript

Feb -25

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.02%)

6. Segments

Carbon Steel

Expected Growth: 2%

Reliance Steel & Aluminum Co.'s Carbon Steel segment growth is driven by increasing demand from the automotive and construction industries, coupled with the company's strategic acquisitions and expansion into new markets. Additionally, the segment benefits from the ongoing trend of infrastructure development and the need for sustainable and cost-effective building materials.

Aluminum

Expected Growth: 3%

Reliance Steel & Aluminum Co.'s 3% growth in Aluminum segment is driven by increasing demand from automotive and aerospace industries, coupled with rising infrastructure spending. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to the growth. Furthermore, the ongoing trend of lightweighting in the automotive industry, which favors aluminum over steel, has also boosted demand.

Stainless Steel

Expected Growth: 1%

Reliance Steel & Aluminum Co.'s stainless steel segment growth is driven by increasing demand from the aerospace and automotive industries, coupled with rising infrastructure spending and growing adoption in consumer goods. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth.

Alloy

Expected Growth: 4%

Reliance Steel & Aluminum Co.'s Alloy segment growth is driven by increasing demand from the aerospace and defense industries, rising adoption in electric vehicle production, and growing use in construction and infrastructure projects. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth.

Toll Processing and Logistics

Expected Growth: 1%

Reliance Steel & Aluminum Co.'s Toll Processing and Logistics segment growth is driven by increasing demand for value-added services, strategic acquisitions, and expansion into new markets. Additionally, the company's ability to provide customized solutions, improve operational efficiency, and invest in digital technologies also contribute to its growth.

Other and Eliminations

Expected Growth: 0%

Other and Eliminations segment of Reliance Steel & Aluminum Co. experienced 0% growth, driven by stagnant sales from non-core businesses, lack of new initiatives, and absence of significant cost savings or productivity improvements.

Copper and Brass

Expected Growth: 2%

Reliance Steel & Aluminum Co.'s Copper and Brass segment growth is driven by increasing demand from the electrical and construction industries, as well as rising infrastructure spending. Additionally, the company's strategic acquisitions and expansion into new markets have contributed to its growth, with a 2% growth rate.

7. Detailed Products

Carbon Steel

A type of steel alloy containing a combination of iron and carbon, known for its strength, durability, and versatility

Aluminum Sheets

Thin, flat sheets of aluminum alloy, often used in fabrication, construction, and manufacturing

Stainless Steel Tubing

Hollow tubes made from corrosion-resistant stainless steel, used in high-temperature and high-pressure applications

Galvanized Steel Coils

Coils of steel coated with a layer of zinc for corrosion protection, used in construction, automotive, and industrial applications

Copper Alloys

Alloys of copper, often combined with other metals, used in electrical, plumbing, and industrial applications

Titanium Alloys

High-strength, low-density alloys of titanium, used in aerospace, industrial, and medical applications

8. Reliance Steel & Aluminum Co.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Reliance Steel & Aluminum Co. faces moderate threat from substitutes due to the availability of alternative materials and products.

Bargaining Power Of Customers

Reliance Steel & Aluminum Co. has a diverse customer base, which reduces the bargaining power of individual customers.

Bargaining Power Of Suppliers

Reliance Steel & Aluminum Co. relies on a few large suppliers, which gives them some bargaining power, but the company's scale and diversification mitigate this risk.

Threat Of New Entrants

The capital-intensive nature of the steel and aluminum industry, combined with regulatory barriers, makes it difficult for new entrants to join the market.

Intensity Of Rivalry

The steel and aluminum industry is highly competitive, with many established players competing for market share, leading to a high intensity of rivalry.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 13.43%
Debt Cost 3.95%
Equity Weight 86.57%
Equity Cost 8.52%
WACC 7.91%
Leverage 15.52%

11. Quality Control: Reliance Steel & Aluminum Co. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
NewMarket

A-Score: 6.9/10

Value: 4.5

Growth: 7.2

Quality: 7.2

Yield: 4.0

Momentum: 9.5

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Reliance Steel & Aluminum

A-Score: 5.3/10

Value: 4.7

Growth: 6.1

Quality: 5.6

Yield: 3.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
Steel Dynamics

A-Score: 5.2/10

Value: 3.5

Growth: 7.1

Quality: 5.1

Yield: 2.0

Momentum: 7.0

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
Boise Cascade

A-Score: 5.1/10

Value: 6.9

Growth: 5.8

Quality: 5.4

Yield: 6.0

Momentum: 0.5

Volatility: 6.0

1-Year Total Return ->

View Full Report
Stock-Card
CMC

A-Score: 4.2/10

Value: 3.6

Growth: 3.8

Quality: 4.5

Yield: 2.0

Momentum: 5.0

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
Cleveland-Cliffs

A-Score: 3.8/10

Value: 9.4

Growth: 3.0

Quality: 3.5

Yield: 0.0

Momentum: 4.5

Volatility: 2.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

310.02$

Current Price

310.02$

Potential

-0.00%

Expected Cash-Flows