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It's been a good week for Reliance, Inc. (NYSE:RS) shareholders, because the company has just released its latest first-quarter results, and the shares gained 2.4% to US$284. The result was positive overall - although revenues of US$3.5b were in line with what the analysts predicted, Reliance surprised by delivering a statutory profit of US$3.74 per share, modestly greater than expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.
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Following last week's earnings report, Reliance's six analysts are forecasting 2025 revenues to be US$13.8b, approximately in line with the last 12 months. Per-share earnings are expected to increase 4.9% to US$15.31. Before this earnings report, the analysts had been forecasting revenues of US$14.1b and earnings per share (EPS) of US$16.52 in 2025. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.
See our latest analysis for Reliance
Despite the cuts to forecast earnings, there was no real change to the US$328 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Reliance analyst has a price target of US$362 per share, while the most pessimistic values it at US$307. Even so, with a relatively close grouping of estimates, it looks like the analysts are quite confident in their valuations, suggesting Reliance is an easy business to forecast or the the analysts are all using similar assumptions.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Reliance's revenue growth is expected to slow, with the forecast 0.8% annualised growth rate until the end of 2025 being well below the historical 8.3% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.4% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Reliance.