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Shishir Nigam

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  • Alcoa Kicks Off Earnings: Some Numbers That Don't Add Up [View article]
    Interesting observation you make Karl, about the declining shipments at Alcoa. Revenue growth, seems to be the holy grail this earnings season, and for good reason. Q1 and Q2 earnings have resulted purely from "above expectations" cost-cutting measures...which are by definition, unsustainable in the long-run. To improve earnings from this point on, revenues will have to rise.

    To add another point to your analysis, a big chunk of Alcoa's rise in aluminum demand was attributed to the increased demand for cars, which of course got a one-time boost from cash-for-clunkers. Car sales since then have fallen 41% month-on-month, that's not very encouraging for Alcoa. Whether the other big blue chips can provide/show revenue growth next week, will determine whether the prices come crashing down along with the P/E ratios.

    For more analysis, check out my blog:
    Oct 8 10:55 PM | 4 Likes Like |Link to Comment
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