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AA Earnings: Alcoa Stock Gains Despite Mixed Q1 Results
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AA Earnings: Alcoa Stock Gains Despite Mixed Q1 Results

Story Highlights

Alcoa shares closed higher in yesterday’s extended trading session after the company reported mixed first-quarter results.

Alcoa (NYSE:AA) reported mixed performance in the first quarter. The company’s performance was impacted by lower aluminum prices and a one-time charge related to discontinuing production at the Kwinana alumina refinery. However, AA stock gained 3% in Wednesday’s after-hours trading, reflecting investors’ optimism about Alcoa’s strategic efforts to improve performance.

Alcoa is a supplier of high-quality aluminum products to a wide range of industries.

AA’s Q1 Snapshot

Alcoa’s revenue of $2.6 billion was slightly better than the Street’s forecast of $2.55 billion. However, its revenue fell 2.7% year-over-year. A decline in both shipments and the average realized third-party price for aluminum impacted the company’s top line in Q1.

Meanwhile, AA reported an adjusted loss of $0.81, wider than the analysts’ expectations of a loss of $0.64. Also, it compared unfavorably with a loss of $0.23 in the year-ago quarter. The company attributed the weak performance to restructuring costs and other charges for the Kwinana curtailment.

Production and Shipment Outlook for 2024

Alcoa expects 2024 total Alumina segment production and shipments to be in the range of 9.8 and 10.0 million metric tons, and 12.7 and 12.9 million metric tons, respectively.

Furthermore, production and shipments for the Aluminum unit are expected to remain between 2.2 and 2.3 million metric tons, and between 2.5 and 2.6 million metric tons, respectively.

Is AA a Good Stock to Buy?

Overall, the stock has a Moderate Sell consensus rating based on one Buy, three Hold, and three Sell recommendations. Shares of the company have gained 33.4% in the past three months, outperforming the S&P 500’s (SPX) nearly 6% gain. After this surge in its price, analysts’ average price target on Alcoa stock of $29.36 implies a downside potential of 17.4% from current levels. 

Interestingly, investors interested in AA stock could consider following Citi analyst Alexander Hacking. This five-star analyst is the most accurate analyst covering the stock (in a one-year timeframe).  He boasts an average return of 21.83% per rating and an 81% success rate. Click on the image below to learn more.

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