$7.00
$38.00
bear $7.00
base $19.20
bull $38.00
margin of safety $10.00
market price* $27.46
Ryerson Holding (ticker RYZ, formerly RYI) is a North American metals service center: it buys carbon, stainless and aluminum steel and other metals from mills, then cuts, processes, stores and delivers them to manufacturers, machine shops and fabricators. Revenue was $4.6 billion in 2025. On February 13, 2026 it completed a merger with Olympic Steel, issuing about 19.5 million new shares (roughly 52.6 million diluted shares in the second quarter of 2026, versus 32.1 million in 2025). All per-share values below are on the enlarged share count. How we measure earning power. We use cash from operations, remove the swings in receivables, inventory, payables and accruals (which reverse as metal prices and volumes move), and deduct stock compensation and the portion of capital spending needed to keep the business running. Ryerson's reported figures on this basis, per pre-merger share, were: 2017 $0.25, 2018 $1.26, 2019 $2.50, 2020 $0.23, 2021 $8.92, 2022 $7.82, 2023 $3.34, 2024 -$1.19, 2025 -$1.80. Metals distribution is highly cyclical, so we use the median of these nine years, which spans a full cycle including the 2021-22 price boom and the weak 2024-25 period: $1.26 per share, or about $40 million a year on the old 32 million shares. Earnings fell in 2025 (from -$1.19 to -$1.80), so we assume no growth in year one; the base case starts flat. Large non-cash charges such as depreciation are added back automatically; we found no material wasting intangibles requiring a separate haircut. What we could not fully verify. Olympic Steel's own earnings history is not in the records we use, so we could not build its stand-alone earning power the same way. We credited it conservatively at about $20 million a year, applying Ryerson's own through-cycle ratio of owner earnings to revenue (about 0.9%) to roughly $2 billion of Olympic revenue. That revenue figure is an estimate inferred from the increase in Ryerson's second-quarter 2026 sales ($2.0 billion versus $1.17 billion a year earlier, part of which is higher metal prices), not a reported number. The first half of 2026 looked stronger than this level on our measure (roughly $95 million for six months on the enlarged company), but that includes a partial period of Olympic, a large inventory and receivables build, and non-cash inventory-cost charges, and it is one period, so we did not raise the earnings level on it. Base case, about $19 per share. Combined earning power of roughly $60 million a year (Ryerson's median plus the Olympic estimate), held flat with no growth. We credited no growth because we found none secured or repeatable at small steps: management's targeted $120 million of annual merger synergies by 2028, further market-share gains, and the recent lift in steel prices were left out as targets or conditions not yet demonstrated. What persists beyond ten years is the business itself: Ryerson has operated since 1842 through many downturns, and its network of service centers keeps producing a through-cycle level of cash, so the flat level continues. Bear case, about $7 per share. Three years like 2024-2025, when owner earnings were negative (about $40 million to $58 million a year lost on Ryerson alone; 2025 gross margin fell 100 basis points to 17.1% and the company lost $56 million), followed by a return to the level of the pre-boom years 2017-2020 (median about $0.76 per old share, roughly $28 million) plus a smaller Olympic contribution of about $8 million. The company also carries substantial borrowing after the merger (its credit facility was raised to $1.8 billion), which makes a prolonged downturn more painful; interest is already deducted in these cash figures, and no debt is subtracted separately. Bull case, about $38 per share. Combined earning power of about $120 million a year. This rests on levers already in place: Ryerson finished a heavy investment cycle in 2022-2024 (Shelbyville, Norcross, Dallas and Los Angeles service centers) and capital spending has already fallen to $51 million in 2025 from $122 million in 2023; and non-boom years such as 2019 ($2.50 per share) and 2023 ($3.34) show the business has earned well above the median without peak prices. It does not include the 2021-22 boom levels or the announced synergies. What would make this wrong. If the metal-price and tariff environment that helped first-half 2026 proves temporary and demand stays weak, the bear case is the better guide. If Olympic earns materially more than our estimate, or synergies are delivered, the base case is too low. No case is worth zero or less: cash from operations, after interest, has stayed positive except for the first half of 2026, when cash was consumed by building inventory and receivables. We did not add balance-sheet cash to any case, and we did not deduct debt.