Reliance Steel & Aluminum Co. (RS), metals service center company yesterday announced that they be cutting their second quarter 2017 guidance numbers.

Reliance now expects their second quarter diluted earnings to be in between $1.30 to $1.40 per share which is down from previous guidance numbers of $1.50 to $1.60 per share.  

Reliance Steel & Aluminum Co.  Comments

“As a result of challenging market conditions, the positive momentum experienced for both demand and pricing trends in the first quarter of 2017 did not accelerate as originally anticipated into the second quarter of 2017. In addition, increased uncertainty in regard to metals pricing has placed downward pressure on the Company’s gross profit margin. Despite these changes in market conditions, Reliance continues to believe that it can sustain a reported LIFO gross profit margin within the range of 27% to 29%.”  Globe Newswire

RS Technical Analysis

(Click on image to enlarge)

RS opened trading yesterday at $72.99 which was up from the previous day’s trading close of $72.44. RS closed trading yesterday at $72.51 and crashed down after market to $67.70, equivalent to a 7% decrease from the closing price.

Taking a look at the daily chart we can see the last time RS traded below these levels we have to go back to November 4th, 2016 when it traded at  $67.03. Taking a closer look at the daily chart we can see that before the spike down RS had already been in an overall downward trend dating back to March 1st when it traded at $86.27. RS has a float of 70.41 million shares and traded below the normal daily trading volume on Monday.