Reliance Steel & Aluminum Co. (RS) Stock Analysis

Reliance Steel & Aluminum (RS) holds several durable competitive advantages in the fragmented metals service center industry. Its scale is unmatched: RS operates roughly 320 locations, serving over 125,000 customers, and accounted for 15% of U.S. industry shipments in 2024—far ahead of smaller regional rivals like Ryerson, Olympic Steel, and Worthington. This scale enables superior purchasing power with domestic mills, ensuring reliable supply and favorable pricing, especially during periods of supply disruption.

RS’s value-added processing capabilities are a key differentiator. About 50% of orders include services such as cutting, machining, or finishing, which command higher margins and foster customer stickiness. In contrast, many competitors focus primarily on basic distribution, limiting their pricing power and customer integration.

The company’s decentralized operating model empowers local managers to tailor inventory and service to regional demand, supporting high customer satisfaction—over 95% of sales are to repeat customers, and 40% of orders are delivered within 24 hours. This responsiveness is difficult for less nimble, centralized peers to replicate.

RS’s financial strength underpins its edge: it has consistently out-invested rivals in technology and equipment, maintained investment-grade credit ratings, and delivered industry-leading gross margins (28% in 2025, versus a peer average near 20%). These advantages, combined with a disciplined acquisition strategy, position RS to continue consolidating market share in a cyclical, competitive sector.