UPDATE: UBS Investment Research Downgrades Reliance Steel & Aluminum on Fair Valuation

In a report published Tuesday, UBS Investment Research analyst Matt Murphy downgraded the rating on

from Buy to Neutral, and lowered the price target from $80.00 to $75.00. In the report, UBS Investment Research noted, “RS is a metals service center offering attractive exposure to improving US steel demand while limiting exposure to volatile metal prices. Its model of consolidating service centers has consistently been accretive, as RS normally buys smaller companies at lower multiples using low-cost debt. Within the metals service center industry, RS is a best-in-class operator with a top-tier management team, high inventory turns and EBITDA margins. However, we view the current stock price as fairly valued given our falling steel and aluminum price outlook and its impact on absolute profits. We rate Reliance Steel a Neutral and our $75 PT is based on an 8.0x EV/EBITDA (2015) multiple.” Reliance Steel & Aluminum closed on Monday at $75.48.