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Alcoa's (AA) Unit Closes $750M Worth Senior Notes Offering

Alcoa Corporation AA yesterday announced the closing of a private offering of $750 million worth of senior notes (due to mature in 2027). Notably, the announcement of the offering was made by the company on Jul 8.

It is worth mentioning here that Alcoa’s share price gained 0.9% yesterday, ending the trading session at $11.51.

Inside the Headlines

As noted, the senior notes were offered by the company’s wholly-owned subsidiary, Alcoa Nederland Holding B.V. The debt instruments are now Alcoa’s senior unsecured obligations and are guaranteed by it and some of its subsidiaries.

The coupon rate of the notes is 5.500%, which will be paid out semi-annually on Jun 15 and Dec 15. The first interest payment will be due on Dec 15, 2020.

The proceeds raised from the offerings will be used by Alcoa Nederland Holding for satisfying general corporate purposes and enhancing cash balance.

Notably, Alcoa’s long-term debts were $1,801 million at the end of first-quarter 2020, up from $1,799 million at the end of fourth-quarter 2019. Fresh issuances of debt instruments will increase the company’s debts and might inflate its financial obligations.

Zacks Rank, Earnings Estimates and Price Performance

Alcoa, with a market capitalization of $2.1 billion, currently carries a Zacks Rank #3 (Hold). In the past three months, the company’s shares have gained 58.5% compared with the industry’s growth of 25.2%.




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The Zacks Consensus Estimate for loss is pegged at 4 cents for 2020 and 34 cents for 2021 as compared with a loss of 73 cents and 34 cents mentioned 60 days ago, respectively.

Alcoa Corp. Price and Consensus

 

Alcoa Corp. Price and Consensus
Alcoa Corp. Price and Consensus

Alcoa Corp. price-consensus-chart | Alcoa Corp. Quote

Also, the second-quarter consensus estimate for loss is pegged at 8 cents versus a loss of 35 cents mentioned 60 days ago. The company is slated to report its second-quarter 2020 results on Jul 15, 2020, after market close.

Stocks to Consider

Some better-ranked stocks in the Zacks Industrial Products sector are II-VI Incorporated IIVI, Colfax Corporation CFX and Altra Industrial Motion Corp. AIMC. While II-VI currently sports a Zacks Rank #1 (Strong Buy), both Colfax and Altra Industrial carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, earnings estimates for these stocks improved for the current year. Further, earnings surprise for the last reported quarter was 213.33% for II-VI, 2.70% for Colfax and 47.73% for Altra Industrial.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


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Alcoa Corp. (AA) : Free Stock Analysis Report
 
Colfax Corporation (CFX) : Free Stock Analysis Report
 
IIVI Incorporated (IIVI) : Free Stock Analysis Report
 
Altra Industrial Motion Corp. (AIMC) : Free Stock Analysis Report
 
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