Back to top

Image: Bigstock

Alcoa (AA) Increases Despite Market Slip: Here's What You Need to Know

Read MoreHide Full Article

The most recent trading session ended with Alcoa (AA - Free Report) standing at $31.40, reflecting a +0.16% shift from the previouse trading day's closing. The stock outpaced the S&P 500's daily loss of 0.14%. On the other hand, the Dow registered a loss of 0.77%, and the technology-centric Nasdaq increased by 0.17%.

Shares of the bauxite, alumina and aluminum products company witnessed a gain of 12.97% over the previous month, beating the performance of the Industrial Products sector with its gain of 8.96% and the S&P 500's gain of 5.34%.

Analysts and investors alike will be keeping a close eye on the performance of Alcoa in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be -$0.24, reflecting a 4.35% decrease from the same quarter last year. At the same time, our most recent consensus estimate is projecting a revenue of $2.53 billion, reflecting a 5.25% fall from the equivalent quarter last year.

AA's full-year Zacks Consensus Estimates are calling for earnings of $0.29 per share and revenue of $10.65 billion. These results would represent year-over-year changes of +112.78% and +0.94%, respectively.

Any recent changes to analyst estimates for Alcoa should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, there's been a 11.34% fall in the Zacks Consensus EPS estimate. Alcoa is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note Alcoa's current valuation metrics, including its Forward P/E ratio of 109.36. This expresses a premium compared to the average Forward P/E of 10.98 of its industry.

Meanwhile, AA's PEG ratio is currently 2.5. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Metal Products - Distribution industry currently had an average PEG ratio of 2.5 as of yesterday's close.

The Metal Products - Distribution industry is part of the Industrial Products sector. Currently, this industry holds a Zacks Industry Rank of 28, positioning it in the top 12% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply to follow these and more stock-moving metrics during the upcoming trading sessions.

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

Alcoa (AA) - free report >>

Published in