Reliance Steel & Aluminum (RS) PT Lowered to $321 at KeyBanc Amid 'Softer Pricing'

KeyBanc analyst Philip Gibbs lowered the price target on Reliance Steel & Aluminum (NYSE: RS) to $321.00 (from $325.00) while maintaining an Overweight rating.

The analyst commented: "We trim our 2024E EBITDA to $1.48B (from $1.49B) on softer pricing, including a 4Q24E EBITDA of $263M (from $270M). We decrease our 2025E EBITDA to $1.65B (from $1.68B) on modestly weaker 1H25 gross margins in stainless and select carbon products.

At the recent closing price of ~$290, RS shares trade at ~10.0x LIFO EV/EBITDA on our 2025E (using year-end 2024E net debt) vs. a normalized historical range 7-10x and our prospective range of 9-12x with returns nearer industrial distributors. Our $321 price target reflects ~11.0x LIFO EV/EBITDA on our 2025E, offering deference to its strong ROIC (HSD-LDD), excellent FCFE, and infra optionality."

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