I’ve got my eye on the Reliance Worldwide Corporation Ltd (ASX: RWC) share price today. This comes after a key ASX announcement from the Aussie manufacturer regarding coronavirus restrictions in Victoria.
What was in the ASX announcement?
The manufacturer said it was assessing the impact that Victorian government restrictions may have on its manufacturing and distribution facilities.
Reliance Worldwide manufactures products in its 4 Melbourne plans to supply into the Australian and Asia-Pacific region. There are also some products that are exported to the company’s North American operations.
These products are key to the maintenance and construction of hot and cold water sanitary systems, particularly for domestic housing.
The Reliance Worldwide share price will be one to watch in early trade following the announcement.
What is this in response to?
This comes after the Victorian Government introduced sweeping Stage 4 lockdowns for the Melbourne region until at least 13 September.
That means an estimated further 250,000 Victorians could lose their jobs under the latest restrictions.
Positively, the company said it maintains “sufficient” inventory levels that will substantially mitigate any supply disruptions. Reliance Worldwide does not anticipate any short-term impact on its North American sales.
How has the Reliance Worldwide share price performed this year?
Shares in the Aussie plumbing and heating company fell off a cliff in mid-February.
That coincided with the start of the recent bear market as the Reliance Worldwide share price fell 63.0% in the space of one month.
However, Reliance Worldwide shares have climbed 48.9% since March 24 to coincide with a rise in the S&P/ASX 200 Index (ASX: XJO).
The company’s market capitalisation currently sits at $2.1 billion with a price-to-earnings (P/E) ratio of 17.4.
The manufacturer is set to report its full-year results on Monday 24 August. I think that’s another day to watch the Reliance Worldwide share price, given the current uncertainty.
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More reading
- 5 things to watch on the ASX 200 on Tuesday
- The ASX stocks hit by Victoria’s stage 4 forced shutdowns
- ASX stock of the day: Catapult share price leaps 15% on US college football contract
- The ASX small cap benefitting from COVID that you’ve probably never heard of
- My top retail ASX 200 share to gift right now
Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Reliance Worldwide Limited. The Motley Fool Australia has recommended Reliance Worldwide Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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