Preview of New Report

Russel Metals (RUS) reported 4Q earnings of C$0.46/share exceeding the Street’s C$0.40, 3Q’s C$0.43 and the year-ago EPS of C$0.26. The seasonal pick-up in energy tubulars as well as a volume increase in the steel distributors segment contributed to the strong results.

Management said 1Q has started off well with strong order intake and mill price increases apparently holding, though the company doesn’t have a strong sense of where prices are heading.

The company said that M&A activity is expected to pick up in 2012 and that a dividend increase in 2012 is likely.  Management expects steady demand for energy tubulars in 2012, with the primary growth driver being oil sands projects.

Our full report is available to subscribers only and provides further thoughts on Russel’s 4Q earnings report and conference call as well as the implication for the stock and other equities.

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