Earning Preview: Reliance Steel & Aluminum revenue is expected to increase by 12.56%, and institutional views are overweight

Abstract

Reliance Steel & Aluminum will report quarterly results Post Market on February 18, 2026, with investors watching revenue growth momentum, margins, and adjusted EPS trends in the distribution and value-added processing mix.

Market Forecast

Based on the latest available forecasts for the current quarter, Reliance Steel & Aluminum is projected to deliver revenue of $3.44 billion, implying 12.56% year-over-year growth, with adjusted EPS estimated at 2.83, up 3.56% year-over-year; EBIT is forecast at $206.00 million, up 1.38% year-over-year. Forecasts for gross profit margin and net profit margin were not specified, so the market will likely anchor its expectations to last quarter’s margin baseline and mix. The company’s main commercial engine remains the carbon steel-led distribution and processing portfolio, where volume/price execution and value-added processing intensity guide quarterly earnings cadence and cash returns outlook. Value-added processing and logistics services appear positioned as the most promising earnings lever given their margin profile; this line generated $167.10 million in last quarter’s revenue, with year-over-year figures not disclosed in the available data.

Last Quarter Review

Reliance Steel & Aluminum’s previous quarter delivered revenue of $3.65 billion (up 6.75% year-over-year), a gross profit margin of 28.28%, GAAP net profit attributable to shareholders of $190.00 million, a net profit margin of 5.19%, and adjusted EPS of 3.64 (flat year-over-year). Quarter-on-quarter, GAAP net profit declined by 18.91%, reflecting normalization from prior levels and mix effects embedded in the operating cadence. By business line, carbon steel contributed $2.03 billion, aluminum $621.50 million, stainless steel $489.90 million, value-added processing and logistics services $167.10 million, alloy $159.60 million, copper and brass $102.60 million, and other and eliminations $78.00 million; year-over-year growth by segment was not disclosed in the available data.

Current Quarter Outlook

Core distribution and processing business

The core distribution and processing franchise is set to steer this quarter’s performance, with revenue forecast at $3.44 billion and year-over-year growth of 12.56%. Within this framework, operating leverage will hinge on the balance between spot pricing, contractual pass-through dynamics, and the share of orders routed through higher value-added processing steps. Adjusted EPS is forecast at 2.83, up 3.56% year-over-year, which suggests a more measured earnings advance than revenue growth, consistent with a scenario where gross margin stability, pricing dispersion across product families, and operating expense discipline jointly determine the incremental drop-through rate. Last quarter’s gross profit margin of 28.28% and net margin of 5.19% serve as practical reference points for investors assessing the durability of price-cost spreads into this quarter. A key focal point is whether shipment mix continues to skew toward orders requiring processing — cutting, machining, and just-in-time logistics — which historically supports more resilient margins versus pure commodity turnover. With EBIT forecast at $206.00 million (up 1.38% year-over-year), consensus appears to embed modest margin normalization relative to revenue growth, implying that the portfolio’s earnings cadence may be driven more by volume and processing mix than by price tailwinds alone. Cash conversion and inventory stewardship will also matter this quarter. Working capital swings remain central to free cash flow variability, and the equity narrative often improves when inventory turns and receivables are aligned with shipment trends. This quarter’s stock reaction could therefore be as sensitive to commentary on order intake and backlog health as to the headline revenue figure, since those data points illuminate the forward trajectory for both margins and capital intensity.

Value-added processing and logistics services

Value-added processing and logistics services delivered $167.10 million in revenue last quarter and are poised to remain a constructive contributor this quarter due to their accretive margin characteristics. The line’s strategic role is to embed reliability, precision, and turnaround speed into the distribution model, reinforcing customer stickiness while capturing a premium relative to standard fulfillment. As the forecast suite implies modest year-over-year expansion in revenue and adjusted EPS at the consolidated level, a sustained or higher mix of value-added jobs would help support the earnings bridge this quarter. The resilience of this services line lies in its ability to capture economics from process complexity and timeliness rather than relying solely on underlying metal price moves. That attribute helps temper volatility in consolidated gross margins and supports steadier EBIT dollar generation when metal price-based spreads settle. If this quarter brings continued customer adoption of cut-to-size programs, kitting, and just-in-time logistics — elements that reduce customers’ in-house complexity — it would likely enhance the company’s margin profile, even if headline pricing across certain product types remains mixed. In practice, investors tend to ascribe a premium to recurring, service-oriented revenues when they raise confidence in future margin stability. If management commentary highlights pipeline strength in processing-intensive orders or a rising share of shipments routed through processing centers, it would reinforce the argument that earnings visibility is improving and that the company’s return on invested capital can maintain a healthy spread over its cost of capital.

Key stock price drivers this quarter

Earnings-day dynamics often hinge on how the outlook recalibrates around four elements: top-line pace, margin tone, cash return plans, and capital deployment. With revenue growth implied at 12.56% year-over-year and adjusted EPS up 3.56% year-over-year, the question for shares is whether the company can articulate a path to preserve or enhance gross margin versus last quarter’s 28.28% while maintaining operating cost discipline. Any color on pricing pass-throughs and the extent to which processing fees offset underlying metal price variability will be closely parsed. EBIT is expected to rise 1.38% year-over-year to $206.00 million, a signal of measured, mix-aware growth. If management outlines further efficiency initiatives or highlights gains from ongoing systems, logistics, or cutting automation, investors could extrapolate higher incremental margins into subsequent quarters. Conversely, if margin commentary skews cautious, the market will likely key off cash generation and capital returns to sustain a constructive stance on valuation. Capital allocation can be an important support for the equity story. The company’s track record of dividends and opportunistic buybacks often influences sentiment, particularly when free cash flow trends are favorable. Updates on the M&A pipeline — especially bolt-on acquisitions that deepen local network density or add specialized processing capabilities — can also shape the premium investors are willing to ascribe to forward earnings, given the potential for synergy capture and margin uplift in acquired operations.

Analyst Opinions

Bullish sentiment is dominant among the opinions gathered in the current observation window, with a bullish-to-bearish ratio of 100% to 0%. One well-known institution raised its price target to $325 and maintained an overweight rating in January 2026, while broad compiled estimates reflect an average rating of overweight and a mean price target of $316.25. The core of the bullish case rests on earnings resilience from value-added processing, disciplined cost control, and capital return consistency, rather than reliance on broad price cycles alone. Supportive views emphasize that measured revenue expansion of 12.56% year-over-year this quarter, coupled with a 3.56% year-over-year rise in adjusted EPS, is consistent with a steady operating playbook and a diversified product slate centered on execution. The adjusted EPS forecast of 2.83 aligns with a scenario where the company defends spreads through emphasis on processing intensity and customer service quality — elements that reduce the sensitivity of margin performance to underlying product price moves. Institutional analyses also point to practical guardrails on downside scenarios. With last quarter’s gross margin at 28.28% and net margin at 5.19%, investors can benchmark what constitutes satisfactory performance versus the historical cadence, while last quarter’s quarter-on-quarter net profit decline of 18.91% frames the potential for sequential recovery if volume and mix tilt favorably. In this context, upbeat calls typically argue that the company’s operational discipline, network scale, and commitment to small-order, quick-turn fulfillment sustain elevated service differentiation, which in turn supports throughput utilization across facilities and mitigates earnings volatility. In aggregate, the majority view anticipates that the upcoming print will reinforce the narrative of steadier earnings driven by value-added execution and measured operating leverage. This thesis does not require heroic assumptions about pricing, only that service mix and process efficiency compensate for pockets of price variability. With valuation anchored by an overweight-leaning ratings balance and targets clustered in the low-to-mid $300s, the prevailing institutional stance is that consistent delivery on revenue, margin stewardship, and cash returns can keep the equity case intact through the quarter and into subsequent updates.