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 155 industry peers in the Metals & Mining industry. Both the health and profitability get an excellent rating, making RS a very profitable company, without any liquidiy or solvency issues. RS is valued correctly, but it does not seem to be growing.
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.
In the past 5 years RS has always 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 82.58% of its industry peers.
RS has a Return On Equity of 10.87%. This is in the better half of the industry: RS outperforms 78.71% of its industry peers.
With an excellent Return On Invested Capital value of 9.01%, RS belongs to the best of the industry, outperforming 81.29% 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 11.10%.
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
RS has a better Profit Margin (5.65%) than 72.90% of its industry peers.
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 61.94% of the companies in the same industry.
RS's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 29.34%, RS is in the better half of the industry, outperforming 69.03% of the companies in the same industry.
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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so RS is still creating some value.
RS has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, RS has less shares outstanding
The debt/assets ratio for RS is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 5.96 indicates that RS is not in any danger for bankruptcy at the moment.
The Altman-Z score of RS (5.96) is better than 76.13% of its industry peers.
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 84.52% of its industry peers.
A Debt/Equity ratio of 0.15 indicates that RS is not too dependend on debt financing.
RS has a Debt to Equity ratio of 0.15. This is comparable to the rest of the industry: RS outperforms 54.84% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 1.54 | ||
| Altman-Z | 5.96 |
ROIC/WACC0.92
WACC9.78%
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 69.03% 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.
With a Quick ratio value of 1.58, RS perfoms like the industry average, outperforming 52.90% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 3.17 | ||
| Quick Ratio | 1.58 |
3. Growth
3.1 Past
The earnings per share for RS have decreased strongly by -33.61% in the last year.
The Earnings Per Share has been growing by 8.86% on average over the past years. This is quite good.
The Revenue has decreased by -5.60% in the past year.
The Revenue has been growing slightly by 4.74% on average over the past years.
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
With a Price/Earnings ratio of 21.69, RS is valued on the expensive side.
73.55% of the companies in the same industry are more expensive than RS, based on the Price/Earnings ratio.
RS's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 26.55.
RS is valuated correctly with a Price/Forward Earnings ratio of 15.60.
The rest of the industry has a similar Price/Forward Earnings ratio as RS.
RS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.30, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.69 | ||
| Fwd PE | 15.6 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as RS.
Based on the Price/Free Cash Flow ratio, RS is valued cheaper than 82.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.98 | ||
| EV/EBITDA | 13.14 |
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)3.05
PEG (5Y)2.45
EPS Next 2Y12.08%
EPS Next 3Y4.46%
5. Dividend
5.1 Amount
RS has a Yearly Dividend Yield of 1.56%.
Compared to an average industry Dividend Yield of 2.85, RS pays a bit more dividend than its industry peers.
RS's Dividend Yield is slightly below the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
5.2 History
On average, the dividend of RS grows each year by 14.75%, which is quite nice.
RS has paid a dividend for at least 10 years, which is 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.
RS's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP32.33%
EPS Next 2Y12.08%
EPS Next 3Y4.46%
309.79
+2.72 (+0.89%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners84.44%
Inst Owner Change-1.72%
Ins Owners0.35%
Ins Owner Change1.3%
Market Cap16.29B
Analysts75.29
Price Target333.57 (7.68%)
Short Float %1.72%
Short Ratio2.31
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.56% |
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)-0.3%
PT rev (3m)0.57%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.07%
EPS NY rev (1m)-2.82%
EPS NY rev (3m)-2.79%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.27%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.95%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 21.69 | ||
| Fwd PE | 15.6 | ||
| P/S | 1.19 | ||
| P/FCF | 16.98 | ||
| P/OCF | 11.91 | ||
| P/B | 2.29 | ||
| P/tB | 4.14 | ||
| EV/EBITDA | 13.14 |
EPS(TTM)14.28
EY4.61%
EPS(NY)19.86
Fwd EY6.41%
FCF(TTM)18.24
FCFY5.89%
OCF(TTM)26.01
OCFY8.4%
SpS260.03
BVpS135.04
TBVpS74.9
PEG (NY)3.05
PEG (5Y)2.45
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 | 5.96 |
F-Score4
WACC9.78%
ROIC/WACC0.92
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%