Reliance Steel (RS) is a leading metals service center company engaged in value-added materials management and metals processing services. It distributes metal products including stainless steel, aluminum, brass, copper, titanium and alloy steel to customers across a vast spectrum of industries.
Reliance Steel is well placed to leverage the strong momentum across a number of end markets, including automotive and aerospace. Strategic acquisitions and expansion of existing operations should also support its results. But it remains challenged by weak steel industry fundamentals and contends with soft steel and metals pricing environment.
Let’s have a quick look at this metal processor’s first-quarter 2015 release.
Estimate Trend & Surprise History
Investors should note that the earnings estimate for Reliance Steel for the first quarter has seen a downward trend over the past month. Reliance Steel has missed the Zacks Consensus Estimate in the trailing 4 quarters with an average negative surprise of 4.58%. Investors have been eagerly awaiting the company’s latest earnings report to see whether it starts 2015 with an outperformance in the first quarter.
Earnings
Reliance Steel logged earnings of $1.30 per share that beat the Zacks Consensus Estimate of $1.03.
Revenues
Reliance Steel recorded net sales of $2,614 million, up 2.4% year over year. That also came ahead the Zacks Consensus Estimate of $2,596 million.
Key Stats/Developments to Note
Overall sales volume rose 0.8% year over year in the quarter while same-store sales volumes moved up 5.1%. Average prices per ton went up 0.9% year over year. The company expects adjusted earnings for second-quarter 2015 to be in the band of $1.05 to $1.15 per share.
Zacks Rank
Reliance Steel currently has a Zacks Rank #4 (Sell), which reflects its sustained underperformance.
Market Reaction
Reliance Steel’s shares were inactive following the release. It would be interesting to see how the market reacts to the results during the trading session today.
Check back later for our full write up on Reliance Steel’s earnings report!
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