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Alcoa Q4 Earnings on the Deck: How to Approach the Stock Now?
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Key Takeaways
AA is set to report Q4 results on Jan. 22, with earnings estimates up 18.8% over the past 60 days.
Alcoa's Aluminum segment sales are projected to climb 29% on electrical and packaging demand.
AA benefits from San Ciprian progress, Spain smelter restart efforts and capacity expansion initiatives.
Alcoa Corporation (AA - Free Report) is scheduled to release fourth-quarter 2025 results on Jan. 22, after market close. The Zacks Consensus Estimate for earnings is currently pegged at 95 cents per share on revenues of $3.24 billion.
Fourth-quarter earnings estimates have increased 18.8% over the past 60 days. However, the bottom-line projection indicates a decrease of 8.7% from the year-ago number. Also, the Zacks Consensus Estimate for quarterly revenues indicates a year-over-year decline of 7%.
AA’s Earnings Surprise History
Image Source: Zacks Investment Research
Alcoa has an impressive earnings surprise history. The company’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 39.3%. In the last reported quarter, it delivered an earnings surprise of 86.7%.
Earnings Whispers for AA
Our proven model predicts an earnings beat for the company this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Alcoa has an Earnings ESP of +0.53% as the Most Accurate Estimate is pegged at 96 cents per share, higher than the Zacks Consensus Estimate of 95 cents. It sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
An increase in demand for products in the electrical and packaging end markets in North America and Europe, is expected to have benefited Alcoa’s Aluminum segment in the fourth quarter. Also, continued progress on the San Ciprián and the restart of the Spain smelter are likely to have aided the segment’s sales. For the fourth quarter, the Zacks Consensus Estimate for the Aluminum segment’s total sales is pegged at $2.45 billion, indicating a 29% rise from the year-ago reported number.
Alcoa’s Alumina segment is expected to have benefited from an increase in production at the Australian refineries and the growing popularity of its Sustana line of products. However, the segment’s results are anticipated to put up a weak show due to lower shipments of alumina arising from the curtailment of the Kwinana refinery and decreased trading activity. The consensus mark for the Alumina segment’s total sales is pegged at $1.32 billion, indicating a 46% decline from the year-ago number.
Nevertheless, synergistic gains from partnerships and acquisitions made by the company are expected to have boosted its performance. In March 2025, Alcoa and IGNIS EQT entered into a joint venture agreement to resume and improve the production capacity of its San Ciprian site. In August 2024, Alcoa acquired Alumina Limited. This acquisition bolstered its position as a pure-play and upstream aluminum company worldwide.
Also, Alcoa's efforts to increase smelter and refinery capacity are likely to have supported its results in the to-be-reported quarter.
However, the escalating cost of sales due to higher input costs poses a threat to Alcoa’s bottom line. Also, given the company’s extensive geographic presence, its operations are subject to global political risks and foreign exchange headwinds. A stronger U.S. dollar is likely to have hurt AA's overseas business in the to-be-reported quarter.
AA Price Performance
Alcoa’s shares have surged 54.2% in the past three months compared with the Zacks Metal Products - Distribution industry’s 49.9% growth. The company’s shares have also fared better than the S&P 500’s increase of 4.2%. Its peers, Constellium SE (CSTM - Free Report) and Ryerson Holding Corp. (RYI - Free Report) have gained 38.9% and 24.9%, respectively, in the same period.
Three-Month Price Performance
Image Source: Zacks Investment Research
Alcoa’s Valuation Remains a Tailwind
AA’s valuation offers upside potential. The stock is trading at a forward 12-month price-to-earnings (P/E) ratio of 12.50X, slightly lower than the industry average of 12.82X.
In comparison with Alcoa’s valuation, its peers, Constellium and Ryerson Holding, are trading higher. Constellium and Ryerson Holding are trading at 12.94X and 21.56X, respectively.
Price-to-Earnings (Forward 12 Months)
Image Source: Zacks Investment Research
Investment Thesis
With a comprehensive and diversified product portfolio, Alcoa has been benefiting from the growing popularity of lighter and energy-efficient electric vehicles, recycled aluminum and rechargeable batteries. The company’s strategic collaborations and strength in the electrical and packaging markets bode well for its fourth-quarter earnings.
Its worth noting that in June 2025, the U.S. administration increased tariffs on imported aluminum to 50% as a measure to correct trade imbalances and boost the domestic industry. The move has increased aluminum prices, thereby benefiting domestic producers like Alcoa which is likely to drive itss performance in the quarters ahead.
Should You Buy AA Now?
Solid momentum across end markets, accretive acquisitions and synergistic gains from partnerships position Alcoa favorably for strong fourth-quarter results.
With a positive analyst sentiment and robust growth prospects, Alcoa is well-positioned to deliver sustained growth and shareholder value. We believe that AA stock is an ideal candidate for an investor's portfolio addition.
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Alcoa Q4 Earnings on the Deck: How to Approach the Stock Now?
Key Takeaways
Alcoa Corporation (AA - Free Report) is scheduled to release fourth-quarter 2025 results on Jan. 22, after market close. The Zacks Consensus Estimate for earnings is currently pegged at 95 cents per share on revenues of $3.24 billion.
Fourth-quarter earnings estimates have increased 18.8% over the past 60 days. However, the bottom-line projection indicates a decrease of 8.7% from the year-ago number. Also, the Zacks Consensus Estimate for quarterly revenues indicates a year-over-year decline of 7%.
AA’s Earnings Surprise History
Image Source: Zacks Investment Research
Alcoa has an impressive earnings surprise history. The company’s earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 39.3%. In the last reported quarter, it delivered an earnings surprise of 86.7%.
Earnings Whispers for AA
Our proven model predicts an earnings beat for the company this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks before they are reported with our Earnings ESP Filter.
Alcoa has an Earnings ESP of +0.53% as the Most Accurate Estimate is pegged at 96 cents per share, higher than the Zacks Consensus Estimate of 95 cents. It sports a Zacks Rank of 1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Alcoa Price and EPS Surprise
Alcoa price-eps-surprise | Alcoa Quote
Factors Driving Alcoa’s Performance
An increase in demand for products in the electrical and packaging end markets in North America and Europe, is expected to have benefited Alcoa’s Aluminum segment in the fourth quarter. Also, continued progress on the San Ciprián and the restart of the Spain smelter are likely to have aided the segment’s sales. For the fourth quarter, the Zacks Consensus Estimate for the Aluminum segment’s total sales is pegged at $2.45 billion, indicating a 29% rise from the year-ago reported number.
Alcoa’s Alumina segment is expected to have benefited from an increase in production at the Australian refineries and the growing popularity of its Sustana line of products. However, the segment’s results are anticipated to put up a weak show due to lower shipments of alumina arising from the curtailment of the Kwinana refinery and decreased trading activity. The consensus mark for the Alumina segment’s total sales is pegged at $1.32 billion, indicating a 46% decline from the year-ago number.
Nevertheless, synergistic gains from partnerships and acquisitions made by the company are expected to have boosted its performance. In March 2025, Alcoa and IGNIS EQT entered into a joint venture agreement to resume and improve the production capacity of its San Ciprian site. In August 2024, Alcoa acquired Alumina Limited. This acquisition bolstered its position as a pure-play and upstream aluminum company worldwide.
Also, Alcoa's efforts to increase smelter and refinery capacity are likely to have supported its results in the to-be-reported quarter.
However, the escalating cost of sales due to higher input costs poses a threat to Alcoa’s bottom line. Also, given the company’s extensive geographic presence, its operations are subject to global political risks and foreign exchange headwinds. A stronger U.S. dollar is likely to have hurt AA's overseas business in the to-be-reported quarter.
AA Price Performance
Alcoa’s shares have surged 54.2% in the past three months compared with the Zacks Metal Products - Distribution industry’s 49.9% growth. The company’s shares have also fared better than the S&P 500’s increase of 4.2%. Its peers, Constellium SE (CSTM - Free Report) and Ryerson Holding Corp. (RYI - Free Report) have gained 38.9% and 24.9%, respectively, in the same period.
Three-Month Price Performance
Image Source: Zacks Investment Research
Alcoa’s Valuation Remains a Tailwind
AA’s valuation offers upside potential. The stock is trading at a forward 12-month price-to-earnings (P/E) ratio of 12.50X, slightly lower than the industry average of 12.82X.
In comparison with Alcoa’s valuation, its peers, Constellium and Ryerson Holding, are trading higher. Constellium and Ryerson Holding are trading at 12.94X and 21.56X, respectively.
Price-to-Earnings (Forward 12 Months)
Image Source: Zacks Investment Research
Investment Thesis
With a comprehensive and diversified product portfolio, Alcoa has been benefiting from the growing popularity of lighter and energy-efficient electric vehicles, recycled aluminum and rechargeable batteries. The company’s strategic collaborations and strength in the electrical and packaging markets bode well for its fourth-quarter earnings.
Its worth noting that in June 2025, the U.S. administration increased tariffs on imported aluminum to 50% as a measure to correct trade imbalances and boost the domestic industry. The move has increased aluminum prices, thereby benefiting domestic producers like Alcoa which is likely to drive itss performance in the quarters ahead.
Should You Buy AA Now?
Solid momentum across end markets, accretive acquisitions and synergistic gains from partnerships position Alcoa favorably for strong fourth-quarter results.
With a positive analyst sentiment and robust growth prospects, Alcoa is well-positioned to deliver sustained growth and shareholder value. We believe that AA stock is an ideal candidate for an investor's portfolio addition.