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Reliance Steel's (RS) Q3 Earnings, Revenues Top Estimates
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Reliance Steel & Aluminum Co. (RS - Free Report) posted a profit of $97.3 million or $1.32 per share in the third quarter of 2017, a roughly 97% surge from $49.5 million or 68 cents per share a year ago.
Barring one-time items, earnings were $1.30 per share for the quarter that exceeded the Zacks Consensus Estimate of $1.20.
The company witnessed continued demand strength across automotive and aerospace markets along with higher year over year pricing levels in the quarter, which contributed positively to earnings. Demand in the third quarter was stronger than the company’s expectations.
Reliance Steel recorded net sales of $2,450.1 million in the reported quarter, up around 12% year over year, beating the Zacks Consensus Estimate of $2,366 million.
Overall sales volume rose 5.3% year over year while average prices per ton went up 6.8%
Financials
Reliance Steel ended the quarter with cash and cash equivalents of $170.2 million, up roughly 19% year over year. Long-term debt increased roughly 13% year over year to $1,896 million. Cash flow from operations was $183.1 million for the third quarter.
Reliance Steel did not repurchase any shares during the third quarter. It had around 8.4 million shares available for buyback under its existing share repurchase program at the end of the quarter.
Outlook
Moving ahead, Reliance Steel remains optimistic regarding activity levels of business in the fourth quarter, which is subject to typical decline in shipping volumes resulting from fewer shipping days due to holiday-related customer closures.
Reliance Steel estimates tons sold will be down 4% to 6% in the fourth quarter on a sequential comparison basis. Average selling prices are projected to be flat to down 2% in the fourth quarter compared with the third quarter. Additionally, the company expects earnings per share to be in the band of 90 cents to $1.00 for the fourth quarter.
Price Performance
Reliance Steel’s shares have gained 16.6% over a year versus the 9.8% decline of its industry.
Zacks Rank & Key Picks
Reliance Steel currently carries a Zacks Rank #3 (Hold).
Koppers has expected long-term earnings growth of 18%.
Huntsman has expected long-term earnings growth of 7%.
FMC has expected earnings growth of 11.3% for the current year.
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Reliance Steel's (RS) Q3 Earnings, Revenues Top Estimates
Reliance Steel & Aluminum Co. (RS - Free Report) posted a profit of $97.3 million or $1.32 per share in the third quarter of 2017, a roughly 97% surge from $49.5 million or 68 cents per share a year ago.
Barring one-time items, earnings were $1.30 per share for the quarter that exceeded the Zacks Consensus Estimate of $1.20.
The company witnessed continued demand strength across automotive and aerospace markets along with higher year over year pricing levels in the quarter, which contributed positively to earnings. Demand in the third quarter was stronger than the company’s expectations.
Reliance Steel recorded net sales of $2,450.1 million in the reported quarter, up around 12% year over year, beating the Zacks Consensus Estimate of $2,366 million.
Overall sales volume rose 5.3% year over year while average prices per ton went up 6.8%
Financials
Reliance Steel ended the quarter with cash and cash equivalents of $170.2 million, up roughly 19% year over year. Long-term debt increased roughly 13% year over year to $1,896 million. Cash flow from operations was $183.1 million for the third quarter.
Reliance Steel did not repurchase any shares during the third quarter. It had around 8.4 million shares available for buyback under its existing share repurchase program at the end of the quarter.
Outlook
Moving ahead, Reliance Steel remains optimistic regarding activity levels of business in the fourth quarter, which is subject to typical decline in shipping volumes resulting from fewer shipping days due to holiday-related customer closures.
Reliance Steel estimates tons sold will be down 4% to 6% in the fourth quarter on a sequential comparison basis. Average selling prices are projected to be flat to down 2% in the fourth quarter compared with the third quarter. Additionally, the company expects earnings per share to be in the band of 90 cents to $1.00 for the fourth quarter.
Price Performance
Reliance Steel’s shares have gained 16.6% over a year versus the 9.8% decline of its industry.
Zacks Rank & Key Picks
Reliance Steel currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the basic materials space include Koppers Holdings Inc. (KOP - Free Report) , Huntsman Corporation (HUN - Free Report) and FMC Corporation (FMC - Free Report) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Koppers has expected long-term earnings growth of 18%.
Huntsman has expected long-term earnings growth of 7%.
FMC has expected earnings growth of 11.3% for the current year.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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