Alcoa (AA) closed the most recent trading day at $34.70, moving +0.67% from the previous trading session. This change outpaced the S&P 500's 0.21% loss on the day. Meanwhile, the Dow lost 0.43%, and the Nasdaq, a tech-heavy index, added 0.03%.
Coming into today, shares of the bauxite, alumina and aluminum products company had lost 37.89% in the past month. In that same time, the Industrial Products sector lost 11.75%, while the S&P 500 lost 9.7%.
Wall Street will be looking for positivity from Alcoa as it approaches its next earnings report date. In that report, analysts expect Alcoa to post earnings of $0.45 per share. This would mark a year-over-year decline of 78.05%. Meanwhile, our latest consensus estimate is calling for revenue of $3.03 billion, down 2.51% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.16 per share and revenue of $13.01 billion. These totals would mark changes of +4.83% and +7.04%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for Alcoa. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.41% lower within the past month. Alcoa is holding a Zacks Rank of #4 (Sell) right now.
In terms of valuation, Alcoa is currently trading at a Forward P/E ratio of 4.81. This represents a discount compared to its industry's average Forward P/E of 5.55.
Also, we should mention that AA has a PEG ratio of 0.49. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Metal Products - Distribution was holding an average PEG ratio of 0.49 at yesterday's closing price.
The Metal Products - Distribution industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 12, putting it in the top 5% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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