Alcoa Corp. | $AA Stock | Shares Plunge Following Q4 Earnings Miss

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Alcoa Corp. (NYSE: AA)

 

On Wednesday after the close, shares of Alcoa Corp. took a nose dive following a Q4 earnings miss. The company announced earnings per share of $1.04 on $3.17 billion in revenues while analyst were looking for $1.23 earnings per share.

This isn’t that bad of an earnings release. They grew year-over-year but they just happened to miss analyst estimates which usually causes for some selling.

Alcoa Technicals

Taking a look at the 5-minute chart above you can see that shares had a solid sell off following their earnings release with a nearly 7.8% drop at current prices in the premarket.

Depending on where prices open, the 20-day moving average should act as support or resistance which is currently sitting at $52.97. If prices move below then we really don’t have much support until $50. If prices can hold the moving average then we are looking at $54 and $55 as major levels of resistance.

This one will be a volatile name today and will likely present some great opportunities for active traders.

CEO Comments

CEO, President & Director Roy Harvey stated, “Our fourth quarter results represent our highest adjusted EBITDA since our launch just over a year ago. We generated $775 million in adjusted EBITDA, excluding special items, up $214 million sequentially primarily on higher alumina prices. While this is up nearly 40% from the prior quarter, 4 short-term operational and financial impacts contributed to results that were about $50 million lower than our stated expectations. Those 4 things were roughly equal in impact.”

Company Profile

Alcoa Corp. engages in the production of bauxite, alumina and aluminum products. It operates through the following segments: Bauxite, Alumina, Aluminum, Cast Products, Energy and Rolled Products.

The Bauxite segment portfolio represents its bauxite mining assets and it is mined and sold primarily to internal customers within the Alumina segment, who then process it into alumina. The Alumina segment represents its worldwide refining system, which processes bauxite into alumina, which is mainly sold directly to internal and external smelter customers worldwide.

The Aluminum segment represents its worldwide smelter system, which receives alumina, mostly from the Alumina segment, and produces molten primary aluminum. The Cast Products segment represents its worldwide cast house system, which are made from molten aluminum, purchased primarily from its Aluminum segment, which is then formed into various value-added ingot products, including billet and slab, for use in fabrication operations in a variety of industries.

The Energy segment represents portfolio of energy assets. The Rolled Products segment represents its rolling mill in Warrick, Indiana, which produces aluminum sheet primarily sold directly to customers in the packaging end market for the production of aluminum cans.

Alcoa Corporation began operation as a separate company on November 1, 2016 and was formed by Alcoa Inc. (now named Arconic Inc.) via a distribution of shares (spinoff) to existing Alcoa Inc. stockholders. The company is headquartered in New York, NY. –MarketWatch

 

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