It has been about a month since the last earnings report for Reliance (RS). Shares have lost about 3.8% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Reliance due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for Reliance, Inc. before we dive into how investors and analysts have reacted as of late.

Reliance’s Q2 Earnings Beat Estimates on Record Shipments and Pricing

Reliance reported second-quarter 2026 adjusted earnings of $6.27 per share, up 41.5% year over year. The figure beat the Zacks Consensus Estimate of $5.38 by 16.5%, driven by higher shipments, improved gross profit per ton and contributions from the U.S. border wall project. 

Net sales rose 26.5% to $4.63 billion and surpassed the consensus estimate of $4.17 billion by 10.9%. Tons sold increased 10.8% year over year to a quarterly record of 1.79 million, exceeding management’s projection of 1-3% growth. The figure surpassed our estimate of 1.7 million. 

The average selling price per ton advanced 14.5% to $2,602. The average selling price per ton climbed 7.8% from the first quarter, topping the company’s forecast of 1.5-3.5% growth. Higher carbon steel and aluminum prices supported the increase. It was above our estimate of $2,479. 

Segment Update

Demand in non-residential construction, including infrastructure, improved year over year, supported by data centers, energy infrastructure and public projects. The company expects demand in this sector to continue to improve in the third quarter, supported by strong activity across data centers, energy infrastructure and public infrastructure. 

Broader manufacturing demand strengthened on healthy activity in industrial machinery, shipbuilding, military, consumer products and construction machinery. Reliance expects the demand to remain healthy in the third quarter. 

Aerospace demand improved from the second quarter. Reliance expects gradual commercial aerospace build-rate increases and robust defense and space activity. Reliance expects commercial aerospace demand to remain strong in the third quarter. 

Automotive toll-processing demand also improved and is expected to remain steady at healthy levels. The company’s toll processing operations remain agile and responsive to the automotive market’s demand fluctuations. 

Semiconductor demand increased meaningfully year over year, aided by growing data center activity. The company expects semiconductor-related demand to continue improving during the third quarter. 

Financial Position

Reliance ended June 30, 2026, with cash and cash equivalents of $235.4 million. Total outstanding debt was $1.7 billion, including $520 million drawn under the company’s $1.5 billion revolving credit facility. 

Operating cash flow totaled $162.2 million in the quarter. Free cash flow was $68.8 million. 

Reliance did not repurchase common shares during the second quarter. However, the company repurchased $234.2 million of stock during the first half of 2026. Roughly $529 million remained available under its share-repurchase authorization at quarter-end. 

Outlook

Reliance expects third-quarter 2026 adjusted earnings of $6.40-$6.60 per share. The projection includes LIFO expense of $75 million, or $1.10 per share, and approximately 60 cents per share of earnings from the U.S. border wall project. 

Excluding the project, tons sold are expected to decline 2-4% sequentially due to normal seasonality. Including an estimated 2% sequential contribution from the project, total shipments are projected to increase 9-11% year over year. 

The average selling price per ton is expected to be flat to up 2% from the second quarter. Management anticipates generally healthy to improving demand and pricing, although trade-policy uncertainty, geopolitical conflict and potential supply constraints remain risks.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a upward trend in fresh estimates.

The consensus estimate has shifted 39.9% due to these changes.

VGM Scores

At this time, Reliance has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Reliance has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.

Beyond Nvidia: AI's Second Wave Is Here

The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.

See Stocks Now >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

 

Reliance, Inc. (RS): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research