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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.

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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's Q3 Earnings: A Closer Look

Reliance reported a non-GAAP earnings per diluted share of $3.64, slightly below estimates of $3.68. Revenue growth was driven by a 6.2% increase in tons sold compared to the third quarter of 2024, significantly outperforming the service center industry. Gross profit margin was 29% in the third quarter, up from the third quarter of 2024. The company's operating cash flow was approximately $262 million, which was strategically redeployed into high-value initiatives.

Publication Date: Oct -27

📋 Highlights
  • Market Share Growth: Reliance increased U.S. market share to 17.1% in Q3 2025, up from 14.5% in 2023, driven by strategic investments and sales execution.
  • Non-GAAP Earnings Performance: Reported $3.64 non-GAAP EPS, aligning with guidance and matching Q3 2024 results despite margin headwinds from trade policy uncertainty.
  • Operating Cash Flow and Capital Deployment: Generated $262M in operating cash flow, reinvesting in growth initiatives and returning $124M to shareholders via dividends and buybacks (1.4M shares repurchased YTD).
  • Gross Margin Expansion: Achieved 29% gross profit margin in Q3 2025, up from prior-year levels, with FIFO pretax income rising 30% despite competitive pricing pressures.
  • Q4 Outlook and Guidance: Expects flat-to-slightly improved FIFO gross margin and $2.65–$2.85 non-GAAP EPS in Q4, with tons sold projected to grow 3.5–5.5% YoY amid stable demand.

Financial Performance

The company's financial performance was characterized by a strong increase in tons sold, which offset some of the pricing pressure. The average selling price remained steady compared to the second quarter of 2025. The company's FIFO pretax income increased 30% compared to the third quarter of 2024. As Karla Lewis noted, "Our tons sold were a third quarter record, increasing our U.S. market share to 17.1%, up from 14.5% in 2023 due to our smart, profitable growth strategy."

Outlook and Guidance

Reliance expects overall demand in the fourth quarter to remain stable across its diversified end markets, subject to ongoing domestic and international trade policy uncertainty. The company estimates its tons sold will be up 3.5% to 5.5% compared to the fourth quarter of 2024. The company anticipates Q4 non-GAAP earnings per diluted share in the range of $2.65 to $2.85.

Valuation

With a P/E Ratio of 20.06 and an EV/EBITDA of 12.53, Reliance's valuation multiples indicate a moderate premium. Analysts estimate next year's revenue growth at 4.3%. The company's ROE is 10.09%, and ROIC is 8.0%, indicating a decent return on equity and invested capital. The Dividend Yield is 1.7%, providing a relatively stable income stream.

Operational Highlights

The company's focus on execution and customer service has helped it win new business and increase its market share. Reliance has invested in expanded processing capabilities, and its salespeople are aggressively educating customers and proving themselves. As Karla Lewis stated, "We've invested in expanded processing capabilities, and our salespeople are going out aggressively to educate customers and prove ourselves."

3. NewsRoom

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Reliance, Inc. (RS) Presents at Goldman Sachs Industrials and Materials Conference 2025 Transcript

Dec -03

Source: seekingalpha.com

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Reliance, Inc. $RS Shares Sold by Advisors Asset Management Inc.

Nov -28

Source: defenseworld.net

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Reliance, Inc. (RS) Presents at Baird 55th Annual Global Industrial Conference Transcript

Nov -14

Source: seekingalpha.com

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Reliance, Inc. Announces Upcoming Conference Participation

Nov -06

Source: globenewswire.com

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Bessemer Group Inc. Sells 2,284 Shares of Reliance, Inc. $RS

Nov -03

Source: defenseworld.net

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Asset Management One Co. Ltd. Reduces Position in Reliance, Inc. $RS

Oct -29

Source: defenseworld.net

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Reliance: Stable; Awaiting A Recovery

Oct -26

Source: seekingalpha.com

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Reliance's Earnings Miss, Revenues Surpass Estimates in Q3

Oct -24

Source: zacks.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: 6.7/10

Value: 4.5

Growth: 7.2

Quality: 7.2

Yield: 3.0

Momentum: 9.5

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Reliance Steel & Aluminum

A-Score: 5.3/10

Value: 4.6

Growth: 6.1

Quality: 5.6

Yield: 3.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

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Stock-Card
Boise Cascade

A-Score: 5.1/10

Value: 6.8

Growth: 5.8

Quality: 5.6

Yield: 6.0

Momentum: 0.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Steel Dynamics

A-Score: 4.9/10

Value: 3.4

Growth: 7.1

Quality: 5.1

Yield: 2.0

Momentum: 6.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
CMC

A-Score: 4.4/10

Value: 3.9

Growth: 3.8

Quality: 4.5

Yield: 2.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Cleveland-Cliffs

A-Score: 3.6/10

Value: 9.2

Growth: 3.1

Quality: 3.5

Yield: 0.0

Momentum: 4.0

Volatility: 2.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

285.82$

Current Price

285.82$

Potential

-0.00%

Expected Cash-Flows