Updated 3/13/25
Reliance, Inc. is a business built on a solid foundation, supplying metal processing and distribution services to the industries that shape everyday life—construction, aerospace, transportation, and energy. It’s not sexy, but it’s steady. And when it comes to dividends, that’s the name of the game.
Based in Los Angeles, Reliance has grown into one of the largest metals service companies in North America. Their operations span more than 300 locations, and they’re known for their decentralized model that gives local managers real authority. That kind of business approach tends to deliver consistent performance over time, even in cyclical industries. For dividend-focused investors, it means predictable cash flow and management that knows how to navigate economic ups and downs.
Recent Events
It’s been a choppy year for Reliance. The stock is down around 13% over the past 12 months, trailing the broader market, which has seen a healthy rebound. At its peak, the stock hit $342. Today, it’s trading around $287. That’s a noticeable drop, but the context matters.
The company has faced some headwinds, including a 61% year-over-year drop in earnings and a 6.3% decline in revenue in the most recent quarter. These numbers reflect broader softness in industrial demand rather than anything fundamentally wrong with the business. Metal prices and customer volumes have cooled off, and that’s showing up in the financials.
But Reliance isn’t losing control. Cash flow is holding up, the dividend remains well-funded, and the company’s conservative balance sheet is still in great shape. That resilience is what long-term investors should be paying attention to.
Key Dividend Metrics
📈 Forward Dividend Yield: 1.67%
💵 Annual Dividend Payout: $4.80 per share
🔁 5-Year Average Yield: 1.71%
🧮 Payout Ratio: 28.28%
📅 Next Dividend Date: March 21, 2025
⚖️ Dividend Safety: Backed by strong cash flow and modest debt
Dividend Overview
At first glance, Reliance’s dividend might not turn heads. The yield sits just under 1.7%, which is modest compared to higher-yielding stocks. But that’s only part of the picture. The real value lies in how secure and consistent that dividend is.
The company has a track record of paying and raising its dividend through multiple economic cycles. The payout ratio is under 30%, leaving plenty of room for flexibility, even during downturns. This isn’t a case of stretching earnings to keep investors happy. Reliance pays what it can afford—no more, no less—and that’s exactly what makes it sustainable.
For investors who prioritize reliability over flash, this kind of dividend policy is a major plus.
Dividend Growth and Safety
One of the more compelling parts of Reliance’s dividend story is the growth behind it. This isn’t a static payout. The company raised its dividend from $4.40 to $4.80 recently, continuing a streak of annual increases that goes back over a decade.
That kind of consistency doesn’t happen by accident. It’s the result of a management team that runs the business with a long-term mindset and focuses on shareholder returns without overextending.
More importantly, the financial foundation is solid. With $1.43 billion in operating cash flow and nearly $700 million in free cash flow, Reliance is more than covering its dividend obligations. Debt is modest, and the company’s operations generate enough liquidity to withstand economic cycles.
When a company is still raising its dividend during periods of slower growth, that tells you something about its confidence—and its discipline.
Chart Analysis
Price Action and Trend Behavior
Looking at the chart for Reliance, Inc. (RS), there’s a clear story unfolding over the past year. After a strong rally in early 2024 that pushed the stock near the $340 level, momentum broke down sharply. What followed was a prolonged period of volatility and lower highs, with a series of attempts to reclaim prior strength, none of which held up for long.
The stock is currently trading at $277.62, sitting below both its 50-day and 200-day moving averages. That crossover back in late January, where the 50-day dipped below the 200-day, is often referred to as a death cross. It tends to reinforce that the broader trend has weakened, and buyers are starting to get cautious.
More recently, the price has slid beneath that 200-day line again, which had briefly acted as support. It’s now looking more like resistance, with the most recent candles showing rejection off that level. This reinforces the bearish undertone.
Volume Activity
Volume has been relatively muted for most of the chart, with just a few spikes that appear to be isolated events rather than trend-defining moves. One of the largest volume bars came during a sell-off in December, which also corresponded to the lowest price on the chart. That kind of volume spike often suggests capitulation or panic selling, which was followed by a bounce, but nothing sustained.
More recently, volume has faded, even as the stock slides lower. That lack of conviction suggests this isn’t a panicked exit—it’s more like quiet selling or rotation out of the name. It’s not the kind of volume that points to a strong base building yet.
RSI and Momentum
The Relative Strength Index (RSI) has been grinding lower, currently sitting well below the midpoint. This tells us momentum has been fading for a while. There were a few periods where RSI reached overbought levels, particularly around October and again in February, both followed by retracements. Now, RSI is pointing downward again, tracking with price and confirming weakness.
At no point recently has RSI indicated bullish divergence. That suggests there’s no hidden strength beneath the surface. Right now, sellers remain in control.
Recent Candlestick Action
Zooming into the latest five candles gives a feel for the current battle. Each of the last few sessions shows upper wicks, especially the most recent one on March 12, which opened at the high and closed at the low of the day. That kind of candle often reflects strong intraday selling pressure—buyers showed up early, but couldn’t hold the line.
Wicks on the previous sessions are also telling. There’s hesitation near resistance levels, but no aggressive buying stepping in to absorb it. It’s a sign of supply outweighing demand for now.
Overall, the chart shows a name that’s in a correction phase, with no confirmed signs of reversal yet.
Analyst Ratings
Recent Analyst Actions
In the past few months, analysts have updated their ratings and targets for Reliance, Inc. (RS), reflecting shifting sentiment as the company moves through a softer part of the metals cycle.
📈 February 24, 2025 – KeyBanc maintained an Overweight rating and nudged its price target higher from $321 to $327. This was a show of confidence in Reliance’s fundamentals and ability to maintain margins, even in a challenging macro environment. The move implies an upside of around 17.8% from the stock’s current levels.
📉 July 26, 2024 – Wolfe Research downgraded the stock from Hold to Sell. The call came amid rising concerns about a broader industrial slowdown and potential pricing pressure in the metals space. Their view centered on softer end-market demand and margin compression risks.
📊 October 25, 2024 – BMO Capital reiterated its Outperform rating but trimmed the price target slightly from $340 to $330. While the analysts remained optimistic about the company’s long-term outlook, the lower target reflected a more cautious stance on near-term earnings growth.
🟡 December 2, 2024 – Goldman Sachs initiated coverage with a Hold rating and a target price of $341. The neutral stance reflected a balanced view: solid fundamentals offset by limited upside at the time of initiation, given where the stock was trading.
Consensus Price Target
🎯 As of late March 2025, the average 12-month price target for RS is approximately $328.03. Analyst estimates range from a low of $307.23 to a high of $352.00, placing the current target roughly 14.5% above the stock’s recent price of $287.39.
Reasons for Upgrades and Downgrades
Several themes are behind the mixed analyst sentiment:
🏗️ Sector Cyclicality – Expectations for a slowdown in construction and manufacturing have put pressure on sentiment across the industrial metals sector.
💰 Cash Flow Strength – Those upgrading or maintaining favorable views often point to Reliance’s solid cash flow generation and conservative financial management.
📉 Earnings Compression – Downgrades typically revolve around fears of declining margins and slower revenue growth, especially after the company posted a sharp year-over-year earnings decline.
Analysts remain divided, but most agree the company has the stability to weather short-term turbulence, even if the upside may be more gradual from here.
Earning Report Summary
Reliance, Inc. closed out the fourth quarter of 2024 with results that reflected the tougher environment across the industrial and metals sectors. The company posted earnings per share of $2.22 on an adjusted basis. That number came in a little shy of what management had expected—partly due to year-end inventory and tax adjustments that knocked about 74 cents off the final tally.
Revenue for the quarter landed at $3.13 billion, which was down compared to the $3.34 billion from the same period the year before. A big factor was softer demand, with volumes dipping about 5 percent from the third quarter. That said, the drop was less severe than what the company had originally guided for. Pricing also came down a bit, which added to the top-line pressure.
Still, there were a few bright spots. The company’s adjusted gross margin actually improved to 28.8 percent, up from the prior quarter. That bump came from tighter control over inventory costs and strong discipline on pricing. Reliance also continued leaning into its value-added services, which helped offset some of the softness elsewhere.
Throughout the year, Reliance remained active on the growth front. They brought four acquisitions into the fold, which added close to $300 million in sales for 2024. Management expects those businesses to contribute roughly $400 million in annualized revenue going forward. Capital spending also came in strong at $430 million, signaling their continued investment in long-term infrastructure and operations.
Cash generation was a major highlight. Operating cash flow hit $1.43 billion for the year—one of the best showings in the company’s history. That cash was put to work in a big way. Reliance returned nearly $1.1 billion to shareholders through buybacks, trimming the total share count by about 6 percent. They also paid out close to $250 million in dividends over the course of the year.
Looking into early 2025, management remains cautiously optimistic. Demand in non-residential construction is holding up, especially in sectors like data centers, infrastructure, and manufacturing. The company is guiding toward first-quarter earnings between $3.30 and $3.50 per share, signaling confidence that the year is starting on more stable footing.
Despite some softness in the recent quarter, Reliance continues to execute with a steady hand, focusing on cash flow, disciplined capital allocation, and long-term growth.
Financial Health and Stability
Reliance has quietly built one of the more durable financial profiles in the industrial sector. The balance sheet is clean, with total debt of $1.42 billion against $318 million in cash. That may sound like a lot of debt, but it’s relatively low when compared to the company’s size and cash flow.
Return on equity stands at 11.7%, and return on assets is a healthy 7.2%. These aren’t flashy figures, but they point to efficient use of capital, especially for a company that deals in heavy materials and logistics.
What stands out is the current ratio of 3.2. That indicates more than enough short-term liquidity to cover obligations. For income-focused investors, this level of financial stability matters. It reduces the risk of dividend cuts and supports the company’s ability to reinvest in operations without borrowing heavily.
Valuation and Stock Performance
Reliance is trading at about 18.5 times trailing earnings and around 19.5 times forward earnings. That puts it close to market average valuations, though still reasonable considering the company’s dependable cash flow and low payout ratio.
The price-to-sales ratio sits at 1.17, and price-to-book at 2.11—both within historical norms. From a valuation perspective, Reliance doesn’t appear stretched. In fact, after the recent pullback, the stock looks more like it’s moving sideways than setting up for any major trend change.
It’s also worth noting the stock is hovering right at its 50-day and just below its 200-day moving average. That suggests consolidation, not a clear uptrend or breakdown. For investors who aren’t concerned with timing but are focused on cash generation, this kind of technical drift is often a good place to accumulate long-term holdings.
Risks and Considerations
Like any company tied to industrial demand, Reliance faces cyclical risks. When the economy slows, construction and manufacturing do too—and that puts pressure on the metals business. We’re already seeing this show up in the latest earnings report.
Commodity pricing is another factor. Reliance doesn’t control the prices of the metals it processes and sells. If input costs move too quickly or customer pricing softens, margins can get squeezed.
And while the dividend is safe, the yield is modest. For investors who need higher immediate income, this stock may not fit the bill—though the long-term growth of the payout could still make it attractive in a diversified dividend portfolio.
There’s also the broader market risk. With a beta of 0.87, Reliance tends to move somewhat independently of the broader market. That can be good during volatile times, but it also means the stock might lag during big bull runs.
Final Thoughts
Reliance, Inc. isn’t trying to be the next big thing—and that’s its strength. This is a company that delivers consistent performance, strong free cash flow, and a reliable dividend in an industry that’s often anything but predictable.
It’s not a high-yield play, and it won’t make headlines with explosive growth. But for dividend investors who value safety, steady increases, and solid fundamentals, Reliance offers something many income stocks can’t: peace of mind.
This is the kind of holding that doesn’t demand constant attention. It does its job quietly in the background, compounding value while investors focus on the big picture. And for a long-term dividend strategy, that’s often exactly what’s needed.