Ryerson – strong fundamentals with a margin of safety

Ryerson (NYSE: RYI) is a leading value-added processor and distributor of industrial metals with operations in the United States.

RYI's revenue growth from 2014 to 2022 was driven by changes in selling price rather than tonnage growth. The price growth, especially the price spike in the past 2 years, enabled it to generate strong earnings. But there were improvements in operating efficiencies and the company is financially sound.

It is a cyclical company despite its diverse offerings and customer base. A valuation based on its performance over the cycle shows that there is a sufficient margin of safety