Reliance Steel (NYSE: RS) reported Q3 EPS of $1.87, $0.37 better than the analyst estimate of $1.50. Revenue for the quarter came in at $2.09 billion versus the consensus estimate of $2.13 billion.

GUIDANCE:

Reliance Steel sees Q4 2020 EPS of $1.30-$1.40, versus the consensus of $1.68.

• While macroeconomic uncertainty stemming from the COVID-19 pandemic continues, based on current expectations and market conditions, Reliance management anticipates overall demand to continue its slow improvement in the fourth quarter of 2020. However, due to normal seasonal factors including customer holiday-related shutdowns and fewer shipping days in the fourth quarter of 2020 compared to the third quarter of 2020, the Company expects shipping volumes to decline but believes the impact of seasonal factors could be less than in prior years. As a result, the Company estimates that tons sold will be down 4% to 6% in the fourth quarter of 2020 compared to the prior quarter. Further, the Company expects metals pricing, primarily for carbon steel products, in the fourth quarter will improve due to mill price increases. However, management believes these price increases will be partially offset given Reliance’s diverse product mix and declining sales in certain markets such as aerospace which typically involve higher priced products. As such, management estimates its average selling price per ton sold for the fourth quarter of 2020 will be flat to up 2% compared to the third quarter of 2020. Based on these expectations, Reliance management currently anticipates non-GAAP earnings per diluted share in the range of $1.30 to $1.40 for the fourth quarter of 2020.

For earnings history and earnings-related data on Reliance Steel (RS) click here.