Alcoa (NYSE:AA) Shares Gap Up on Better-Than-Expected Earnings

Shares of Alcoa (NYSE:AA) gapped up prior to trading on Thursday following a better than expected earnings announcement. The stock had previously closed at $35.65, but opened at $37.69. Alcoa shares last traded at $41.00, with a volume of 2,585,056 shares.

The industrial products company reported ($0.02) earnings per share for the quarter, topping analysts’ consensus estimates of ($0.15) by $0.13. Alcoa had a return on equity of 16.31% and a net margin of 8.91%.The business had revenue of $3 billion during the quarter, compared to analyst estimates of $3.03 billion. During the same quarter in the previous year, the firm earned $0.57 EPS. Alcoa’s revenue was up 3.1% on a year-over-year basis.

Alcoa Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Friday, November 21st. Shareholders of record on Tuesday, November 4th will be given a $0.10 dividend. The ex-dividend date of this dividend is Tuesday, November 4th. This represents a $0.40 dividend on an annualized basis and a yield of 1.0%. Alcoa’s payout ratio is 10.44%.

Analysts Set New Price Targets

A number of brokerages have weighed in on AA. BMO Capital Markets boosted their target price on Alcoa from $35.00 to $37.00 and gave the stock a “market perform” rating in a research report on Thursday. HSBC upped their price target on shares of Alcoa from $33.00 to $41.00 and gave the company a “buy” rating in a research report on Friday, October 17th. Weiss Ratings raised shares of Alcoa from a “sell (d+)” rating to a “hold (c-)” rating in a research report on Wednesday, October 8th. UBS Group upped their price target on shares of Alcoa from $31.00 to $34.00 and gave the company a “neutral” rating in a research report on Friday, September 19th. Finally, Citigroup raised shares of Alcoa to a “buy” rating and set a $42.00 price target for the company in a research report on Tuesday, July 8th. Seven research analysts have rated the stock with a Buy rating, five have issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat, the company presently has an average rating of “Hold” and a consensus price target of $42.04.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the business. State Street Corp boosted its stake in Alcoa by 9.8% in the 2nd quarter. State Street Corp now owns 10,737,466 shares of the industrial products company’s stock worth $316,863,000 after purchasing an additional 959,240 shares during the period. Dimensional Fund Advisors LP boosted its stake in Alcoa by 33.9% in the 1st quarter. Dimensional Fund Advisors LP now owns 6,803,086 shares of the industrial products company’s stock worth $207,490,000 after purchasing an additional 1,721,222 shares during the period. L1 Capital Pty Ltd boosted its stake in Alcoa by 178.8% in the 2nd quarter. L1 Capital Pty Ltd now owns 4,814,342 shares of the industrial products company’s stock worth $142,071,000 after purchasing an additional 3,087,298 shares during the period. Geode Capital Management LLC boosted its stake in Alcoa by 4.8% in the 2nd quarter. Geode Capital Management LLC now owns 4,637,897 shares of the industrial products company’s stock worth $136,898,000 after purchasing an additional 211,141 shares during the period. Finally, Norges Bank bought a new position in Alcoa in the 2nd quarter worth approximately $97,933,000.

Alcoa Stock Up 12.4%

The company has a current ratio of 1.65, a quick ratio of 0.97 and a debt-to-equity ratio of 0.41. The firm has a market capitalization of $10.37 billion, a P/E ratio of 9.25, a P/E/G ratio of 0.23 and a beta of 2.20. The company has a 50 day simple moving average of $33.29 and a two-hundred day simple moving average of $29.89.

Alcoa Company Profile

Alcoa Corporation, together with its subsidiaries, produces and sells bauxite, alumina, and aluminum products in the United States, Spain, Australia, Iceland, Norway, Brazil, Canada, and internationally. The company operates through two segments, Alumina and Aluminum. It engages in bauxite mining operations; and processes bauxite into alumina and sells it to customers who process it into industrial chemical products, as well as aluminum smelting and casting businesses.