RELIANCE INC (RS) Stock Fundamental Analysis
NYSE:RS - New York Stock Exchange, Inc. - US7595091023 - Common Stock - Currency: USD
We assign a fundamental rating of 6 out of 10 to RS. RS was compared to 154 industry peers in the Metals & Mining industry. RS gets an excellent profitability rating and is at the same time showing great financial health properties. RS has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
RS had positive earnings in the past year.
In the past year RS had a positive cash flow from operations.
Each year in the past 5 years RS has been profitable.
RS had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
RS has a Return On Assets of 7.45%. This is amongst the best in the industry. RS outperforms 83.12% of its industry peers.
The Return On Equity of RS (10.87%) is better than 79.22% of its industry peers.
With an excellent Return On Invested Capital value of 9.01%, RS belongs to the best of the industry, outperforming 81.17% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for RS is above the industry average of 11.67%.
The 3 year average ROIC (15.30%) for RS is well above the current ROIC(9.01%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 10.87% | ||
| ROIC | 9.01% |
ROA(3y)13.1%
ROA(5y)11.73%
ROE(3y)18.46%
ROE(5y)17.16%
ROIC(3y)15.3%
ROIC(5y)14.22%
1.3 Margins
With a decent Profit Margin value of 5.65%, RS is doing good in the industry, outperforming 72.73% of the companies in the same industry.
In the last couple of years the Profit Margin of RS has remained more or less at the same level.
With a decent Operating Margin value of 7.73%, RS is doing good in the industry, outperforming 61.69% of the companies in the same industry.
RS's Operating Margin has declined in the last couple of years.
RS's Gross Margin of 29.34% is fine compared to the rest of the industry. RS outperforms 68.18% of its industry peers.
In the last couple of years the Gross Margin of RS has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.73% | ||
| PM (TTM) | 5.65% | ||
| GM | 29.34% |
OM growth 3Y-14.8%
OM growth 5Y-1.51%
PM growth 3Y-14.23%
PM growth 5Y-0.22%
GM growth 3Y-2.25%
GM growth 5Y-0.38%
2. Health
2.1 Basic Checks
RS has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for RS has been reduced compared to 1 year ago.
RS has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, RS has a worse debt to assets ratio.
2.2 Solvency
RS has an Altman-Z score of 6.13. This indicates that RS is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 6.13, RS is in the better half of the industry, outperforming 77.27% of the companies in the same industry.
The Debt to FCF ratio of RS is 1.54, which is an excellent value as it means it would take RS, only 1.54 years of fcf income to pay off all of its debts.
RS has a better Debt to FCF ratio (1.54) than 85.06% of its industry peers.
RS has a Debt/Equity ratio of 0.15. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.15, RS perfoms like the industry average, outperforming 54.55% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.54 | ||
| Altman-Z | 6.13 |
ROIC/WACC0.95
WACC9.51%
2.3 Liquidity
RS has a Current Ratio of 3.17. This indicates that RS is financially healthy and has no problem in meeting its short term obligations.
With a decent Current ratio value of 3.17, RS is doing good in the industry, outperforming 68.83% of the companies in the same industry.
A Quick Ratio of 1.58 indicates that RS should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.58, RS is in line with its industry, outperforming 52.60% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.17 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
RS shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -33.61%.
The Earnings Per Share has been growing by 8.86% on average over the past years. This is quite good.
Looking at the last year, RS shows a decrease in Revenue. The Revenue has decreased by -5.60% in the last year.
RS shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.74% yearly.
EPS 1Y (TTM)-33.61%
EPS 3Y-10.36%
EPS 5Y8.86%
EPS Q2Q%-28.87%
Revenue 1Y (TTM)-5.6%
Revenue growth 3Y-0.61%
Revenue growth 5Y4.74%
Sales Q2Q%-4.39%
3.2 Future
Based on estimates for the next years, RS will show a small growth in Earnings Per Share. The EPS will grow by 4.46% on average per year.
The Revenue is expected to grow by 3.11% on average over the next years.
EPS Next Y7.12%
EPS Next 2Y12.08%
EPS Next 3Y4.46%
EPS Next 5YN/A
Revenue Next Year2.25%
Revenue Next 2Y3.47%
Revenue Next 3Y3.11%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 22.90 indicates a rather expensive valuation of RS.
Based on the Price/Earnings ratio, RS is valued a bit cheaper than 74.03% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.45, RS is valued at the same level.
With a Price/Forward Earnings ratio of 16.46, RS is valued correctly.
The rest of the industry has a similar Price/Forward Earnings ratio as RS.
The average S&P500 Price/Forward Earnings ratio is at 21.90. RS is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.9 | ||
| Fwd PE | 16.46 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of RS indicates a somewhat cheap valuation: RS is cheaper than 61.04% of the companies listed in the same industry.
83.12% of the companies in the same industry are more expensive than RS, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 17.93 | ||
| EV/EBITDA | 13.82 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates RS does not grow enough to justify the current Price/Earnings ratio.
RS has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.22
PEG (5Y)2.58
EPS Next 2Y12.08%
EPS Next 3Y4.46%
5. Dividend
5.1 Amount
RS has a Yearly Dividend Yield of 1.53%. Purely for dividend investing, there may be better candidates out there.
RS's Dividend Yield is a higher than the industry average which is at 2.94.
Compared to the average S&P500 Dividend Yield of 2.38, RS is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
5.2 History
On average, the dividend of RS grows each year by 14.75%, which is quite nice.
RS has been paying a dividend for at least 10 years, so it has a reliable track record.
RS has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.75%
Div Incr Years14
Div Non Decr Years30
5.3 Sustainability
32.33% of the earnings are spent on dividend by RS. This is a low number and sustainable payout ratio.
The dividend of RS is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP32.33%
EPS Next 2Y12.08%
EPS Next 3Y4.46%
326.96
+1.52 (+0.47%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners84.46%
Inst Owner Change-1.72%
Ins Owners0.36%
Ins Owner Change1.3%
Market Cap17.19B
Analysts75.29
Price Target333.57 (2.02%)
Short Float %2.39%
Short Ratio3.73
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.53% |
Yearly Dividend4.5
Dividend Growth(5Y)14.75%
DP32.33%
Div Incr Years14
Div Non Decr Years30
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-11.17%
Min EPS beat(2)-21.24%
Max EPS beat(2)-1.11%
EPS beat(4)0
Avg EPS beat(4)-7.58%
Min EPS beat(4)-21.24%
Max EPS beat(4)-1.11%
EPS beat(8)1
Avg EPS beat(8)-3.39%
EPS beat(12)4
Avg EPS beat(12)0.67%
EPS beat(16)8
Avg EPS beat(16)2.92%
Revenue beat(2)0
Avg Revenue beat(2)-1.29%
Min Revenue beat(2)-1.78%
Max Revenue beat(2)-0.81%
Revenue beat(4)0
Avg Revenue beat(4)-1.85%
Min Revenue beat(4)-3.08%
Max Revenue beat(4)-0.81%
Revenue beat(8)0
Avg Revenue beat(8)-2.9%
Revenue beat(12)0
Avg Revenue beat(12)-2.56%
Revenue beat(16)4
Avg Revenue beat(16)-1.22%
PT rev (1m)0%
PT rev (3m)0.31%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.49%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.79%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.57%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.9 | ||
| Fwd PE | 16.46 | ||
| P/S | 1.26 | ||
| P/FCF | 17.93 | ||
| P/OCF | 12.57 | ||
| P/B | 2.42 | ||
| P/tB | 4.37 | ||
| EV/EBITDA | 13.82 |
EPS(TTM)14.28
EY4.37%
EPS(NY)19.86
Fwd EY6.07%
FCF(TTM)18.24
FCFY5.58%
OCF(TTM)26.01
OCFY7.96%
SpS260.03
BVpS135.04
TBVpS74.9
PEG (NY)3.22
PEG (5Y)2.58
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.45% | ||
| ROE | 10.87% | ||
| ROCE | 11.7% | ||
| ROIC | 9.01% | ||
| ROICexc | 9.3% | ||
| ROICexgc | 14.55% | ||
| OM | 7.73% | ||
| PM (TTM) | 5.65% | ||
| GM | 29.34% | ||
| FCFM | 7.01% |
ROA(3y)13.1%
ROA(5y)11.73%
ROE(3y)18.46%
ROE(5y)17.16%
ROIC(3y)15.3%
ROIC(5y)14.22%
ROICexc(3y)17.1%
ROICexc(5y)15.58%
ROICexgc(3y)27.77%
ROICexgc(5y)25.53%
ROCE(3y)19.87%
ROCE(5y)18.47%
ROICexcg growth 3Y-17.15%
ROICexcg growth 5Y-1.39%
ROICexc growth 3Y-16.41%
ROICexc growth 5Y0.04%
OM growth 3Y-14.8%
OM growth 5Y-1.51%
PM growth 3Y-14.23%
PM growth 5Y-0.22%
GM growth 3Y-2.25%
GM growth 5Y-0.38%
F-Score4
Asset Turnover1.32
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.54 | ||
| Debt/EBITDA | 0.81 | ||
| Cap/Depr | 149.31% | ||
| Cap/Sales | 2.99% | ||
| Interest Coverage | 27.11 | ||
| Cash Conversion | 102.79% | ||
| Profit Quality | 124.25% | ||
| Current Ratio | 3.17 | ||
| Quick Ratio | 1.58 | ||
| Altman-Z | 6.13 |
F-Score4
WACC9.51%
ROIC/WACC0.95
Cap/Depr(3y)164.53%
Cap/Depr(5y)134.41%
Cap/Sales(3y)2.76%
Cap/Sales(5y)2.38%
Profit Quality(3y)100.25%
Profit Quality(5y)122.37%
High Growth Momentum
Growth
EPS 1Y (TTM)-33.61%
EPS 3Y-10.36%
EPS 5Y8.86%
EPS Q2Q%-28.87%
EPS Next Y7.12%
EPS Next 2Y12.08%
EPS Next 3Y4.46%
EPS Next 5YN/A
Revenue 1Y (TTM)-5.6%
Revenue growth 3Y-0.61%
Revenue growth 5Y4.74%
Sales Q2Q%-4.39%
Revenue Next Year2.25%
Revenue Next 2Y3.47%
Revenue Next 3Y3.11%
Revenue Next 5YN/A
EBIT growth 1Y-34.71%
EBIT growth 3Y-15.33%
EBIT growth 5Y3.16%
EBIT Next Year20.38%
EBIT Next 3Y9.01%
EBIT Next 5YN/A
FCF growth 1Y-44.27%
FCF growth 3Y21.09%
FCF growth 5Y-1.16%
OCF growth 1Y-34.83%
OCF growth 3Y21.39%
OCF growth 5Y1.9%