Alcoa (NYSE:AA) Given Consensus Rating of "Hold" by Analysts

Key Points

• Analyst sentiment on Alcoa is mixed, with 11 analysts giving the stock a consensus rating of “Hold”. The group includes two sell ratings, four holds, and five buys, with an average 12-month price target of about $64.91.
• Recent analyst moves have been mostly cautious, as several firms cut price targets or downgraded the stock, including Morgan Stanley, JPMorgan, Bank of America, and Zacks. At the same time, Wells Fargo remained positive and raised its target to $72, showing the outlook is still divided.
• Alcoa’s latest earnings missed expectations, reporting $1.40 EPS versus the expected $1.60 and revenue of $3.19 billion versus $3.35 billion. The stock also trades well below its 52-week high, while the company continues to pay a quarterly dividend yielding about 0.8%.

Alcoa (NYSE:AA - Get Free Report) has earned a consensus recommendation of "Hold" from the eleven analysts that are currently covering the firm, MarketBeat reports. Two investment analysts have rated the stock with a sell rating, four have given a hold rating and five have assigned a buy rating to the company. The average twelve-month price target among brokers that have issued ratings on the stock in the last year is $64.9091.

Several equities analysts recently weighed in on AA shares. Morgan Stanley restated an "equal weight" rating and set a $53.00 price target (down from $79.00) on shares of Alcoa in a research report on Wednesday, July 8th. JPMorgan Chase & Co. reduced their target price on shares of Alcoa from $70.00 to $55.00 and set a "neutral" rating for the company in a research report on Thursday. Wall Street Zen lowered shares of Alcoa from a "buy" rating to a "hold" rating in a research note on Saturday, May 9th. Argus set a $73.00 price target on shares of Alcoa in a report on Monday, April 27th. Finally, B. Riley Financial dropped their price objective on Alcoa from $92.00 to $80.00 and set a "buy" rating on the stock in a research note on Tuesday, July 7th.

Alcoa Stock Performance

Shares of Alcoa stock opened at $48.69 on Monday. The business's fifty day simple moving average is $63.28 and its 200 day simple moving average is $62.74. The company has a current ratio of 1.48, a quick ratio of 0.88 and a debt-to-equity ratio of 0.36. Alcoa has a 12 month low of $28.11 and a 12 month high of $84.38. The firm has a market capitalization of $12.85 billion, a P/E ratio of 12.33, a price-to-earnings-growth ratio of 0.49 and a beta of 1.63.

Alcoa (NYSE:AA - Get Free Report) last announced its quarterly earnings data on Thursday, April 16th. The industrial products company reported $1.40 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $1.60 by ($0.20). The business had revenue of $3.19 billion during the quarter, compared to the consensus estimate of $3.35 billion. Alcoa had a net margin of 8.27% and a return on equity of 12.57%. The firm's revenue for the quarter was down 5.2% compared to the same quarter last year. During the same quarter last year, the company earned $2.15 EPS. As a group, analysts anticipate that Alcoa will post 7.41 EPS for the current year.

Alcoa Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Friday, June 5th. Shareholders of record on Tuesday, May 19th were paid a $0.10 dividend. The ex-dividend date was Tuesday, May 19th. This represents a $0.40 annualized dividend and a dividend yield of 0.8%. Alcoa's payout ratio is presently 10.13%.

Key Alcoa News

Here are the key news stories impacting Alcoa this week:

• Positive Sentiment: Wells Fargo raised its price target on Alcoa to $72 from $71 and reiterated an overweight rating, signaling confidence in the stock’s longer-term potential.
• Neutral Sentiment: J.P. Morgan initiated/maintained a hold view and set a new $55 price target, which is above the recent trading level but still suggests limited near-term conviction. Alcoa (AA) Receives a Hold from J.P. Morgan
• Neutral Sentiment: Alcoa is expected to report earnings soon, keeping the stock in focus for a potential catalyst if results or guidance surprise investors. Alcoa (AA) Expected to Post Earnings on Thursday
• Negative Sentiment: Zacks Research downgraded Alcoa from hold to strong sell, adding to bearish sentiment around the name. Alcoa Downgraded by Zacks Research
• Negative Sentiment: Bank of America cut its price target to $51 from $57 and kept an underperform rating, reflecting a more cautious view on valuation and near-term fundamentals. Alcoa NYSE: AA Price Target Lowered to $51.00 at Bank of America
• Negative Sentiment: J.P. Morgan also lowered its price target to $55 from $70 while keeping a neutral rating, reinforcing the recent downgrade trend. Alcoa price target lowered by JPMorgan
• Negative Sentiment: Alcoa was added to Zacks’ Strong Sell list, which may weigh on sentiment as investors look for signs of weakening expectations. New Strong Sell Stocks for July 9th
• Negative Sentiment: Morgan Stanley assigned an equal weight rating, which adds to the overall mixed-to-cautious analyst backdrop. Alcoa Receives Equal Weight Rating from Morgan Stanley

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently made changes to their positions in AA. Mirabella Financial Services LLP raised its stake in Alcoa by 12,233.1% in the 3rd quarter. Mirabella Financial Services LLP now owns 40,082,462 shares of the industrial products company's stock valued at $1,318,312,000 after acquiring an additional 39,757,462 shares during the period. Bank of New York Mellon Corp boosted its position in Alcoa by 211.7% during the fourth quarter. Bank of New York Mellon Corp now owns 6,254,017 shares of the industrial products company's stock worth $332,338,000 after purchasing an additional 4,247,559 shares during the period. Castle Hook Partners LP purchased a new position in shares of Alcoa in the fourth quarter worth about $210,874,000. Maple Rock Capital Partners Inc. purchased a new position in shares of Alcoa in the fourth quarter worth about $173,412,000. Finally, AQR Capital Management LLC raised its position in shares of Alcoa by 153.4% in the fourth quarter. AQR Capital Management LLC now owns 4,134,425 shares of the industrial products company's stock valued at $219,703,000 after purchasing an additional 2,503,132 shares during the period.

About Alcoa

Alcoa Corporation is a global industry leader in the production and management of aluminum, offering an integrated value chain that spans bauxite mining, alumina refining, primary aluminum smelting and the fabrication of value-added products. The company's operations are organized into segments that include raw material extraction, chemical processing and the manufacture of metal mill products and engineered solutions.

Alcoa's product portfolio serves diverse end markets such as aerospace, automotive, packaging, construction, electrical and industrial applications.

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