3. Reliance Steel & Aluminum (RS), a metals service center company, provides metals processing services and distributes a line of more than 100,000 metal products, including alloys, aluminum, brass, copper, carbon steel, stainless steel, titanium and specialty steel products to more than 125,000 customers across a range of industries. The company has operations in 38 states through a network of more than 200 locations.
Net income soared 107% to $92.3 million or $1.23 per share for the first quarter of 2011, compared to $44.7 million or 60 cents per share in the same quarter a year ago. Sales for the quarter were up 32% to $1.91 billion with average prices increasing 18% and tons sold escalating 12%. The company recorded an inventory turnover rate of 5 times, based on tons and 4.8 times based on dollars.
With a current dividend yield of 0.73%, the company went ex-dividend yesterday (June 1, 2011) with shareholders eligible for a dividend of 12 cents per share. Beginning first quarter of 2011, RS increased its regular quarterly dividend amount by 20% to 12 cents from 10 cents per share paid earlier in March 2011. For the second quarter of 2011, the company estimates diluted earnings per share in the range of $1.20 to $1.30.Of the nine analysts covering the stock, 78% recommend a buy while the remaining suggest a hold. There are no sell ratings on the stock. Analysts polled by Bloomberg forecast a 12-month price target of $68.60, about 39.3% higher than the stock's current price.
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