For years now, Alcoa (NYSE:AA) has had to deal with mixed economic conditions in the key industries that it serves, with sluggishness in the overall global economy contributing to poor prospects that have held the aluminum specialist’s share price in check. The Company’s portfolio reshaping is driving results.
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On average, 16 analysts polled by Thomson Reuters expected the company to earn $0.23 per share for the second quarter.
Alcoa reported a quarterly net profit of $US140 million, up more than 1 per cent from $US138 million a year earlier.
LME aluminum prices averaged roughly $1,800 per ton over the course of the second quarter in 2014.
Excluding charges related to restructuring, acquisitions and other items, per-share earnings rose to 19 cents from 18 cents. This year, the market expects an improvement in earnings ($0.92 versus $0.19). Further, D.C. Capital Advisors Ltd have 6.94% of their U.S. equity exposure invested in the company for 1.00 million shares. Alcoa Alcoa has curtailed, as well as permanently closed, significant amounts of smelting capacity over the past couple of years, as it reduces its dependence on its commodity businesses and instead focuses on its value-added businesses. Recent acquisitions are fully on track, and paired with our innovations we are cementing Alcoa’s position as a premier aerospace and automotive partner. “Productivity and cash generation were excellent”. They’re expecting between 8% and 9% in global sales growth in the aerospace sector. The 2015 forecast shifted one point on a slower ramp up primarily in the A350 and Bombardier C Series, and future estimated growth rates have been revised upward.
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Alcoa on Wednesday doubled its forecast for the aluminum surplus this year, as China has not cut output as much as expected. Alcoa also is receiving an increasing number of orders for heavy duty trucks and trailers in North America. The Company offers its technology and expertise in automotive and aerospace transportation, building and construction, consumer electronics and packaging, defense applications across air, land and sea, and the oil and gas industry. Schaeffer’s Senior Quantitative Analyst Rocky White ran the numbers to see how the broader S&P 500 Index (SPX) has historically performed in the wake of the scheduled event, based on a positive or negative post-earnings performance from AA. A combination of these factors is likely to lead to an increase in Chinese production and exports, which could further worsen the gap between supply and demand, resulting in weak global aluminum prices.
