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Alcoa (NYSE:AA) shares were up as much as 2% in after-hours following its recent earnings announcement, but could this be another headfake? This aluminum stock has been a nightmare for investors in the past. We expect this nightmare might continue into the future. Alcoa has managed to meet or beat earnings quarterly over the trailing twelve months. On the other hand, the aluminum stock is down 2.5% since then.

Where Alcoa might be a nightmare, BHP could a be a dream come true. The iPath DJ-UBS Aluminum Subindex Total Return SM Index ETN is down only 18% over the last 18-months, compared to Alcoa being down over 40% and Rio Tinto (NYSE:RIO) down only 15%. Alcoa expects global aluminum consumption growth of 7 percent in 2013, up slightly from 6 percent in 2012. Alcoa's EPS is expected to be $0.24 in 2012 and then up 180% for 2013 to $0.66. Over the same period sales are expected to be up 7%. This suggests Alcoa will increase margins vastly.

Putting Alcoa's forecasted profit margin to 2.8% -- versus 1% for the TTM. The issue with this is the TTM operating margin is at 2.8% and the average five-year operating margin is at 0.5%. The overly aggressive growth and profitability concerns only add to fact that Alcoa is still a turnaround play, with debt-to-capital of 40% (versus Rio at a mere 25%).

Industry. After Rio Tinto acquired Alcan in 2007 the concentration in aluminum production got even greater. In 2011, three companies made up 45% of global output. The U.S. is the second largest aluminum consumer, namely on the back of increased housing starts (expected up to 1.1 million units in 2013 from 777K) and auto sales (expected 15.4M in 2013 from 14.4M). Rio has solid international exposure and is increasing its North American exposure - currently around 20% of sales.

Competitors. BHP Billiton Limited (NYSE:BHP) is a diversified natural resources company, operating in aluminum and other base metals, Vale SA (NYSE:VALE) is a Brazil-based metals and mining company, focused on iron ore and Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) is an international mining company focused on copper and gold, and now oil and gas. Alcoa is still the turnaround play of the industry.

Looking at the numbers. Alcoa pays the lowest dividend of the major mining companies at 1.3%. Not to mention the fact that its annual dividend has declined by 30% annually for the last five years. Rio pays a modest dividend yielding 2.8% and has a slightly lower beta at 1.7. Rio also has a price-to-earnings ratio (based on next year earnings) that comes in at 8, with Alcoa at 14. Other sector players include: BHP with a beta of 1.5 and dividend yield 2.8%; Vale pays the highest dividend yield 5.2% and beta 1.5; Freeport has a dividend yield of 3.5% and 1.9 beta.

Although the past is never indicative of the future, Alcoa's past has been sketchy to say the least. Over the last five-years: EPS has been down 30% annually, dividend payments down 38% annually and sales down 6% annually.

The top industry pick - Rio - has also managed to control costs much better than its peers. Rio trades at a price-to-book ratio of 1.5, but the mining industry is at 1.7. On a price-to-earnings (based on forward earnings) Rio is at only 8x, but the industry is upwards of 19x.

Source: Earnings Beat, But Alcoa Is Still A Nightmare