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Here's Why You Should Hold Onto Reliance Stock for Now
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Key Takeaways
RS has completed 76 acquisitions since 1994, expanding products and value-added processing.
RS repurchased $594.1M worth of shares in 2025, raised its dividend 4.2% and ended 2025 with $216.6M in cash.
RS faces headwinds from soft semiconductor and aerospace demand and higher aluminum costs.
Reliance, Inc. (RS - Free Report) benefits from growth led by strategic acquisitions, a diversified business and product portfolio, and strong liquidity amid headwinds from weakness in select markets and cost pressures caused by tariffs.
RS’ shares have gained 3.5% in the past year compared with the Zacks Mining – Miscellaneous industry’s 38.6% rise.
Image Source: Zacks Investment Research
Let’s find out why RS stock is worth retaining at the moment.
RS Stock Gains on Acquisitions & Strong Liquidity
Reliance benefits from a resilient business model serving diverse end markets, strong execution and a sustained push for growth through acquisitions. The company has long pursued an aggressive acquisition strategy as a core driver of operating performance, completing 76 deals since its 1994 IPO, expanding both its product mix and value-added processing capabilities.
The acquisitions of Rotax Metals, Admiral Metals and Nu-Tech Precision Metals align with its strategy of investing in high-quality businesses. The buyout of Southern Steel Supply also expanded the company’s reach in the Southern United States and boosted its value-added processing services.
The buyout of Cooksey Iron & Metal Co boosts Reliance's presence in the fast-growing Southeastern market. The acquisition of American Alloy has expanded Reliance's product portfolio with specialty carbon steel plates as well as new production capabilities. The integration of FerrouSouth’s tolling operations also enhanced its toll processing capabilities and expanded capacity for Feralloy’s existing operations in the Southeastern United States.
Meanwhile, demand for non-residential construction, including infrastructure, Reliance’s largest end market by volume, strengthened in the fourth quarter of 2025 compared with the prior-year quarter. The company expects demand in this sector to remain healthy through the first quarter of 2026, supported by ongoing investment in data centers, manufacturing facilities and public infrastructure projects.
The company’s strong liquidity position also allows it to drive shareholder value. Reliance repurchased approximately 716,000 shares of its common stock during the fourth quarter for $200.1 million. RS also bought back shares worth $594.1 million during 2025.
The company’s board, in February 2026, raised its quarterly dividend by 4.2% to $1.25 per share. RS ended 2025 with cash and cash equivalents of $216.6 million. It generated $831.4 million in cash flow from operations during 2025, aided by prudent working capital management and profitability. RS deployed $1.18 billion of capital toward stockholder returns and organic growth activities last year.
Demand and Cost Headwinds Ail Reliance
While Reliance is experiencing growth across several key markets, the semiconductor segment remains a weak link. Demand stayed soft in the fourth quarter compared with the prior year, as elevated inventories across the supply chain continued to dampen activity. The company expects these headwinds to carry into the first quarter.
Demand in the commercial aerospace market also remains soft, weighed down by elevated inventory levels across the supply chain. While Reliance expects a gradual recovery in 2026 driven by higher build rates, weakness in this segment is likely to persist through the first quarter.
Reliance also faces challenges from aluminum cost inflation due to tariffs amid an elevated supply and soft demand environment. Higher-than-expected aluminum costs led to last-in, first-out (“LIFO”) expense of $114 million for 2025 compared with the company’s estimate of $100 million, weighing on margins. RS sees LIFO expense of $100 million in 2026, mainly from higher carbon and aluminum product costs.
RS’ Zacks Rank & Key Picks
RS currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the Basic Materials space include DuPont de Nemours, Inc. (DD - Free Report) , Compass Minerals International, Inc. (CMP - Free Report) and Balchem Corporation (BCPC - Free Report) .
The Zacks Consensus Estimate for DD’s 2026 earnings is pegged at $2.28 per share, indicating an increase of 35.7% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 6.5%.
The Zacks Consensus Estimate for CMP’s current fiscal year earnings is pinned at 89 cents per share, indicating a 285.4% year-over-year increase. The Zacks Consensus Estimate for CMP’s current fiscal year earnings has been revised 27.1% upward over the past 60 days.
The Zacks Consensus Estimate for BCPC’s 2026 earnings is pinned at $5.47 per share, indicating a 6.2% year-over-year increase. The Zacks Consensus Estimate for BCPC’s 2026 earnings has been revised 1.1% upward over the past 60 days.
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Here's Why You Should Hold Onto Reliance Stock for Now
Key Takeaways
Reliance, Inc. (RS - Free Report) benefits from growth led by strategic acquisitions, a diversified business and product portfolio, and strong liquidity amid headwinds from weakness in select markets and cost pressures caused by tariffs.
RS’ shares have gained 3.5% in the past year compared with the Zacks Mining – Miscellaneous industry’s 38.6% rise.
Image Source: Zacks Investment Research
Let’s find out why RS stock is worth retaining at the moment.
RS Stock Gains on Acquisitions & Strong Liquidity
Reliance benefits from a resilient business model serving diverse end markets, strong execution and a sustained push for growth through acquisitions. The company has long pursued an aggressive acquisition strategy as a core driver of operating performance, completing 76 deals since its 1994 IPO, expanding both its product mix and value-added processing capabilities.
The acquisitions of Rotax Metals, Admiral Metals and Nu-Tech Precision Metals align with its strategy of investing in high-quality businesses. The buyout of Southern Steel Supply also expanded the company’s reach in the Southern United States and boosted its value-added processing services.
The buyout of Cooksey Iron & Metal Co boosts Reliance's presence in the fast-growing Southeastern market. The acquisition of American Alloy has expanded Reliance's product portfolio with specialty carbon steel plates as well as new production capabilities. The integration of FerrouSouth’s tolling operations also enhanced its toll processing capabilities and expanded capacity for Feralloy’s existing operations in the Southeastern United States.
Meanwhile, demand for non-residential construction, including infrastructure, Reliance’s largest end market by volume, strengthened in the fourth quarter of 2025 compared with the prior-year quarter. The company expects demand in this sector to remain healthy through the first quarter of 2026, supported by ongoing investment in data centers, manufacturing facilities and public infrastructure projects.
The company’s strong liquidity position also allows it to drive shareholder value. Reliance repurchased approximately 716,000 shares of its common stock during the fourth quarter for $200.1 million. RS also bought back shares worth $594.1 million during 2025.
The company’s board, in February 2026, raised its quarterly dividend by 4.2% to $1.25 per share. RS ended 2025 with cash and cash equivalents of $216.6 million. It generated $831.4 million in cash flow from operations during 2025, aided by prudent working capital management and profitability. RS deployed $1.18 billion of capital toward stockholder returns and organic growth activities last year.
Demand and Cost Headwinds Ail Reliance
While Reliance is experiencing growth across several key markets, the semiconductor segment remains a weak link. Demand stayed soft in the fourth quarter compared with the prior year, as elevated inventories across the supply chain continued to dampen activity. The company expects these headwinds to carry into the first quarter.
Demand in the commercial aerospace market also remains soft, weighed down by elevated inventory levels across the supply chain. While Reliance expects a gradual recovery in 2026 driven by higher build rates, weakness in this segment is likely to persist through the first quarter.
Reliance also faces challenges from aluminum cost inflation due to tariffs amid an elevated supply and soft demand environment. Higher-than-expected aluminum costs led to last-in, first-out (“LIFO”) expense of $114 million for 2025 compared with the company’s estimate of $100 million, weighing on margins. RS sees LIFO expense of $100 million in 2026, mainly from higher carbon and aluminum product costs.
RS’ Zacks Rank & Key Picks
RS currently carries a Zacks Rank #3 (Hold).
Better-ranked stocks in the Basic Materials space include DuPont de Nemours, Inc. (DD - Free Report) , Compass Minerals International, Inc. (CMP - Free Report) and Balchem Corporation (BCPC - Free Report) .
While DD and CMP sport a Zacks Rank #1 (Strong Buy) each at present, BCPC carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for DD’s 2026 earnings is pegged at $2.28 per share, indicating an increase of 35.7% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 6.5%.
The Zacks Consensus Estimate for CMP’s current fiscal year earnings is pinned at 89 cents per share, indicating a 285.4% year-over-year increase. The Zacks Consensus Estimate for CMP’s current fiscal year earnings has been revised 27.1% upward over the past 60 days.
The Zacks Consensus Estimate for BCPC’s 2026 earnings is pinned at $5.47 per share, indicating a 6.2% year-over-year increase. The Zacks Consensus Estimate for BCPC’s 2026 earnings has been revised 1.1% upward over the past 60 days.