Russel Metals is one of the main metal distributor in Canada and United States. They operate under various banners in three activities: Metals service centers, energy tubular products and steel distributors.

From fundamental viewpoint, the company shows a strong health with an expected turnover growth about 9% for 2012 at CAD 2.93 billion against 2.7 billion for 2011. Net result was negative in 2009 but the company made significant efforts and could be pride to expect a CAD 124 million result for the ongoing fiscal exercise. Revisions are bullish for revenue and EPS and analysts fixed an average target price at CAD 28.1.

Technically the stock recorded a decline during the last month of 15%. A new bullish impulse seems to be taking place on CAD 24.2 short-term support. CAD 24.11 weekly support is crossing by 50-days moving average, confirming the relevance of this level. A bullish trend could push the stock on the way to its CAD 28 level.

Investors could take a buy position on Russel Metals with a first target at CAD 25.8, on the ongoing short-term resistance and by extension on the CAD 27.9 resistance. A stop loss will avoid disappointment below support at CAD 23.4.