Thu, Apr. 30, 5:26 PM
Thu, Apr. 23, 11:26 AM
- China's Ministry of Finance says it will remove the 15% export tax on aluminum-alloy rods and strips, sending aluminum prices lower and hitting Alcoa (AA -3.3%) shares, and it also will cut taxes on rare earths, tungsten and molybdenum.
- Sterne Agee says that although the news will weigh on market sentiment, the impact could be muted given the small slice of the market, the current depressed price of aluminum, and a lack of rebates; however, Alcoa had indicated it was posturing for China to get tighter with regulations rather than looser.
Wed, Apr. 22, 6:17 PM
- Alcoa (NYSE:AA) is initiated with a Neutral rating at Cleveland Research, which has a favorable long-term view of the company while lacking confidence that current estimates had "fully discounted the downside risks associated with weaker aluminum price momentum” as well as excess global production in the face of slowing demand.
- The firm says Alcoa's 2015 EPS could come in below $1.00 if premiums do not stabilize in the LME and regional markets; the consensus estimate for 2015 EPS is $1.05.
- The analysts say the global aluminum industry appears to be entering a near-term net-oversupplied position and a "2-3 point sequential decline in the overall global demand growth environment."
Sat, Apr. 11, 7:00 AM
- The auto sleuths at Autoblog.com tip that the next version of the Chevrolet Silverado could include aluminum body parts (Silverado pics).
- The 2016.5 Silverado model is expected to be unveiled later this year.
- The development follows the bold bet Ford made this year with a move to aluminum with the F-150.
- Demand for the new F-150 has been solid amid stellar reviews, although the fuel economy impact of trimming 700 pounds from the new F-150 was muted a bit when gas prices fell sharply last fall.
- Fiat Chrysler Automobiles (NYSE:FCAU) has been toying with a plan to use aluminum with the next-gen Jeep Wrangler.
- Initiatives by General Motors (NYSE:GM) or Fiat Chrysler to use aluminum could benefit Alcoa (NYSE:AA), Kaiser Aluminum (NASDAQ:KALU), and Constellium (NYSE:CSTM).
- Related Aluminum ETFs: JJU, FOIL.
Thu, Apr. 9, 2:27 PM
- Alcoa (AA -4%) remains sharply lower following mixed Q1 results and its expectations for global aluminum production to exceed demand by 326K metric tons in 2015, compared with its earlier forecast of a 38K ton deficit.
- Most analysts continue to keep the faith, defending their bullish stances even as they curb estimates: Citigroup reiterates its Buy rating, saying Q2 could be a tough quarter as the rolled-products businesses face headwinds but noting that Alcoa still expects to generate positive free cash flow of at least $500M in 2015 while growing its asset portfolio, and Sterne Agee is one of several firms to reaffirm a Buy rating as AA alters its cost structure and increases value-added products.
- BMO Capital is a voice of dissent, calling Q1 a good start for the company but seeing a challenging outlook ahead; it rates the stock Market Perform with a $14 target.
- Metal fabricator RTI International Metals (RTI -3.9%), which AA recently agreed to acquire, and aluminum producing peer Century Aluminum (CENX -5.4%) are both lower; also, KALU -1.5%, NOR -1.8%, ATI +0.3%.
- Earlier: Alcoa points to lower open after mixed Q1, but analysts still say Buy
Thu, Apr. 9, 9:17 AM
- Alcoa (NYSE:AA) -2.2% premarket after reporting better than expected Q1 earnings while sales trailed analyst estimates; much of the earnings beat appears to have been driven by the upstream businesses, which could be disappointing investors.
- Q1 results showed continuing cost control in the upstream business; in AA's primary metals unit, favorable currency moves, lower energy costs in Spain, and productivity gains lowered per unit production costs by 5.4%, offsetting some of the drag from lower aluminum prices and higher alumina costs.
- Nomura cuts its stock price target to $21 from $23 while keeping its Buy rating as it accounts for lower primary aluminum and physical premia values; the firm says AA is trading towards the lower end of its historical valuation range, which does not credit an improved product mix achieved over the past 18 months.
- Stifel cuts its target to $19 from $20 and maintains its Buy rating; despite reduced near term aluminum price assumptions, the firm continues to believe AA will see earnings shift toward its higher value downstream businesses (Briefing.com).
Wed, Apr. 8, 5:38 PM
Wed, Apr. 8, 4:49 PM
- Alcoa (NYSE:AA) -3.3% AH after Q1 earnings beat estimates but revenues fell short of expectations.
- Alcoa upwardly revises its global aluminum demand growth expectations to 9%, totaling 54M metric tons, after predicting 7% demand growth earlier this year.
- Also, AA continues to project ~3.5M metric tons of new demand growth in 2015, or 6.5%, for a record 57.5M metric tons of aluminum this year; it holds steady its 2015 growth projections for the aerospace, automotive, building and construction, industrial gas turbine and packaging end markets.
- During Q1, Alcoa's primary metals business, which includes aluminum smelting operations, posted a Q1 operating profit of $187M vs. a year-earlier loss of $15M as average realized aluminum prices improved by ~10% from a year ago.
- The engineered products division, which makes parts for airplanes, reported operating income rose 1% to $191M, but the rolled products division, which produces sheet aluminum for the auto industry, said its operating income fell 42% to $34M.
Wed, Apr. 8, 4:05 PM
Wed, Apr. 8, 7:12 AM
- It's that time of quarter again - it comes round so fast - with Q1 earnings season due to unofficially kick off after the bell when Alcoa (NYSE:AA) releases its results.
- Analysts expect the aluminum producer to disclose that EPS grew to $0.26 from $0.09 a year earlier and that revenue climbed 8.9% to $5.94B.
- Alcoa reported a strong Q4 in January, but since then its shares have plummeted amid a fall in metal prices.
- Shares are +1.4% premarket.
Tue, Apr. 7, 5:35 PM
Mon, Mar. 30, 8:40 AM
- Alcoa (NYSE:AA) +1.2% premarket after announcing it will curtail all remaining smelting capacity at its Sao Luis facility in Brazil as it continues to optimize its commodity business.
- As a result, AA says it will take a restructuring related charge of $10M-$15M, or $0.01/share, in its Q1.
- AA says the curtailment is in line with its earlier announcement to evaluate 500K metric tons of smelting capacity and 2.8M metric tons of refining capacity for possible curtailment, closure or sale.
- Once the Sao Luis facility is curtailed, AA will have ~740K metric tons, or 21%, of its smelting capacity offline.
Thu, Mar. 26, 10:39 AM
- Alcoa (NYSE:AA) has been approved for a $259M loan from the $25B U.S. Energy Department program that helped fund flops like Fisker and Solyndra as well as successes such as Tesla, which is resuming lending after a four-year hiatus.
- The Alcoa loan will help the company upgrade a plant in Tennessee that supplied the metal for the new all-aluminum body Ford F-150 pickup truck unveiled last year.
Tue, Mar. 17, 3:49 PM
- Alcoa's (AA -1.7%) 16% slide so far this month provides investors with a buying opportunity, as the price weakness reflects the pullback in commodity prices even as the company becomes less and less concentrated on aluminum, Stifel analysts say.
- Alcoa continues to shift its portfolio downstream, reducing its exposure to the commodity side of its business as it considers reducing its smelting capacity by 14% while making acquisitions that boost its exposure to higher-margin businesses; last week’s acquisition of RTI International Metals is another example of that, Stifel says.
- The company also continues to review its upstream portfolio for further curtailments, including today's news that it will sell its refining operations in Suriname to a government-owned company and curtail 443K metric tons/year of alumina refining capacity by April 30.
Mon, Mar. 9, 5:25 PM
- S&P raises its ratings outlook on Alcoa (NYSE:AA) to stable from negative, citing the company's efforts to strengthen credit measures and restructure its businesses, focusing on higher margin products in its engineered products and solutions segment, closing high cost plants, and investing on improving its upstream businesses.
- The ratings agency says it expects Alcoa to "maintain its strong liquidity position, improve its balance sheet, and continue to reduce its cost structure."
- Alcoa's deal to pay $1.5B to purchase titanium product producer RTI International Metals and the commodity curtailment review announced last week reinforce that the company is "dead serious" about transitioning its portfolio, Sterne Agee writes.
- Shares +0.4% AH after falling 5.4% during regular trade, as investors felt the company may have overpaid for RTI.
Mon, Mar. 9, 7:19 AM
- Alcoa (NYSE:AA) has agreed to acquire RTI International (NYSE:RTI) in a stock-for-stock transaction with an enterprise value of $1.5B.
- RTI shareholders will receive 2.8315 Alcoa shares for each RTI share, representing a value of $41 per RTI share based on Alcoa’s closing price on March 6.
- The acquisition is expected to contribute $1.2B in revenues in 2019, up from $794M generated in 2014; RTI’s profitability is expected to reach 25% EBITDA margin in 2019, up from 14.5% in 2014.
- RTI will also grow Alcoa's pro forma 2014 annual aerospace revenues by 13%, up from $5B to $5.6B.
- AA +1.4%; RTI +28.3% premarket
AA vs. ETF Alternatives
Alcoa Inc manufactures and engineers lightweight metals. It products include aluminum, titanium, and nickel, which are used in aircraft, automobiles, commercial transportation, packaging, oil and gas, defense and industrial applications, among others.
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