Reliance, Inc. RS is benefiting from strong end-market demand and acquisitions that are expanding its capabilities and market presence. Robust profitability and cash generation are also supporting share buybacks and dividend growth.
We are positive about RS’ prospects and believe that the time is right for you to add the stock to the portfolio, as it looks promising and is poised to carry the momentum ahead.
Let's see what makes RS stock an attractive investment option at the moment.
Positive Analyst Sentiment for RS Stock
Earnings estimates for RS have been going up over the past 60 days. The Zacks Consensus Estimate for 2026 has increased 11.4%. The consensus estimate for 2027 has also been revised 10.01% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
The Zacks Consensus Estimate for RS’ 2026 earnings is pegged at $19.14, suggesting a 34.2% increase from the previous year’s tally. Earnings are projected to increase 7.9% for 2027.
RS’ Superior Return on Equity (ROE)
ROE is a measure of a company’s efficiency in utilizing shareholders’ funds. ROE for the trailing 12 months for Reliance is 11.37%, above the industry’s level of 2.24%.
Positive Outlook
Reliance expects demand in the second quarter to remain healthy across its diverse end markets, though ongoing domestic and international trade policy uncertainty and Middle East conflict could pose supply availability and macroeconomic risks, influencing performance. The company projects tons sold to increase 1% to 3% from the prior quarter and 4.5% to 6.5% from the year-ago quarter.
The average selling price per ton is anticipatedto be up 1.5-3.5% sequentially. Based on these assumptions, the company forecasts adjusted earnings per share in the range of $5.15 to $5.35 for the second quarter, which includes an estimated LIFO expense of $37.5 million, or 54 cents per share.
Reliance Rides on Strong Demand and Strategic Buyouts
The company is benefiting from strong demand in the non-residential construction market, its largest end market by volume. Demand improved in the first quarter of 2026, driven by public infrastructure projects, heavy civil construction, data centers, energy infrastructure and manufacturing activity.
Through its AMI Metals unit, the company secured major Department of Homeland Security border wall contracts and continues to benefit from steady automotive toll processing demand. It is also seeing improving demand from semiconductor, defense, shipbuilding, industrial machinery and nuclear-related markets.
Reliance continues to strengthen its growth profile through acquisitions aimed at expanding its geographic reach, product offerings and value-added processing capabilities. Major acquisitions, including Metals USA, Tubular Steel, Best Manufacturing, Ferguson, All Metals, Fry Steel Company and Merfish United, have enhanced its service center network, diversified its end markets and broadened its exposure to higher-margin products.
More recent acquisitions, such as Rotax, Admiral Metals, Nu-Tech Precision Metals, Southern Steel Supply, Cooksey Iron & Metal Co. and American Alloy further support the company’s strategy of investing in high-quality businesses, expanding its processing capabilities and increasing its presence in attractive growth markets across the United States.
Reliance is dedicated to delivering value to its investors, backed by a strong liquidity position. It repurchased $234 million of stock at an average price of $299 per share in the first quarter of 2026. The company’s board has raised its quarterly dividend by 4.2% to $1.25 per share.
RS ended the first quarter with cash and cash equivalents of $249.7 million, up from $216.6 million sequentially. The increase was supported by record shipment volumes and healthy profitability during the quarter.
Reliance, Inc. Price and Consensus
Reliance, Inc. price-consensus-chart | Reliance, Inc. Quote
RS’ Zacks Rank & Other Key Picks
RS currently carries a Zacks Rank #2 (Buy).
Other top-ranked stocks in the Basic Materials space include Nucor Corporation NUE, L.B. Foster Company FSTR and Albemarle Corporation ALB, each carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Nucor’s current-year earnings stands at $15.71 per share, implying an 103.8% year-over-year increase. NUE’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed twice, with the average surprise being 8.1%.
The consensus estimate for L.B. Foster’s current-year earnings is pegged at $1.74 per share, implying a 152.2% year-over-year increase. The Zacks Consensus Estimate for FSTR’s current-year earnings has been revised 12.3% higher over the past 60 days.
The Zacks Consensus Estimate for Albemarle’s current-year earnings is pegged at $12.39 per share, indicating a 1,668.4% year-over-year increase. ALB’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with an average surprise of 54.1%.
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Nucor Corporation (NUE): Free Stock Analysis Report
Reliance, Inc. (RS): Free Stock Analysis Report
Albemarle Corporation (ALB): Free Stock Analysis Report
L.B. Foster Company (FSTR): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).