Pittsburgh-based industrial products maker Alcoa (AA) revealed that it has completed the sale of a 2,100-acre property in Frederick County, Maryland, for $100 million in cash. The company produces alumina, bauxite, and aluminum products.
The property previously served as the site of the former Eastalco smelter but closed permanently in 2010. Since the smelter closed, the company has prepared the site for redevelopment, which includes works like grading the site’s land for new business opportunities, completing all required remediation activities, and removing former facilities.
Alcoa’s wholly-owned subsidiary Eastalco Aluminum Company sold the land to a joint venture between TPG Real Estate Partners and Quantum Loophole.
CEO of Quantum Loophole Josh Snowhorn said, “The Eastalco property is ready and ideal for a data center project of unprecedented scale. We are changing the way hyperscale data center developments are deployed, and this Maryland location has the entitlement, power, water, and proximity to Northern Virginia that the Internet industry needs for success.”
Alcoa expects to report a gain of $90 million from this sale in the second quarter of 2021. (See Alcoa stock chart on TipRanks)
Morgan Stanley analyst Carlos De Alba recently reiterated a Buy rating on the stock with a price target of $50 (38.5% upside potential).
The analyst said by the second half of 2021, Alcoa is expected to achieve its adjusted net debt target of between $2 billion and $2.5 billion. “It is also likely to reach the cash liquidity target of $1 billion,” De Alba added.
Overall, the stock has a Moderate Buy consensus rating based on 4 Buys and 4 Holds. The average Alcoa price target of $42.88 implies 18.8% upside potential from current levels. The company’s shares have gained 228.4% over the past year.
According to TipRanks’ Smart Score rating system, Alcoa scores a 9 out of 10, suggesting that the stock is likely to outperform market averages.
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