Reliance Steel & Aluminum Earnings Preview

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Reliance Steel & Aluminum (NYS: RS) hasn't been able to establish an earnings trend, bouncing between beating and falling short of estimates during the past fiscal year. The company will unveil its latest earnings on Thursday, July 28. Reliance Steel and Aluminum provides metals processing services and distributes a full line of more than 100,000 metal products, including alloy, aluminum, brass, copper, carbon steel, stainless steel, titanium and specialty steel products.

What analysts say:

  • Buy, sell, or hold?: Analysts are very bullish on this stock, unanimously backing it as a buy. Analysts like Reliance Steel & Aluminum better than competitor Worthington Industries overall. Two out of six analysts rate Worthington Industries a buy, compared to nine of nine for Reliance Steel & Aluminum. While analysts still rate the stock a Moderate buy, they are a little more optimistic about it compared to three months ago.
  • Revenue Forecasts: On average, analysts predict $2.07 billion in revenue this quarter. That would represent a rise of 27.8% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $1.31 per share. Estimates range from $1.25 to $1.38.

What our community says:
CAPS All-Stars are solidly backing the stock with 95.8% giving it an "outperform" rating. The community at large agrees with the All-Stars with 95.9% awarding it a rating of "outperform." Fools are bullish on Reliance Steel & Aluminum and haven't been shy with their opinions lately, logging 167 posts in the past 30 days. Even with a robust four out of five stars, Reliance Steel & Aluminum's CAPS rating falls a little short of the community's upbeat outlook.

Management:
Reliance Steel & Aluminum's income has fallen year over year by an average of more than threefold.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q1

Q4

Q3

Q2

Gross Margin

26.5%

24.9%

24%

25.7%

Operating Margin

8.1%

4.9%

5.3%

7.1%

Net Margin

4.8%

2.5%

2.9%

3.8%

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At the time this article was published

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