Kaiser Aluminum (NASDAQ:KALU) Shares Gap Up - Should You Buy?

Key Points

• Kaiser Aluminum shares opened sharply higher, rising from a prior close of $156.38 to $163.24 before trading near $161.54.
• Analyst sentiment improved, with UBS upgrading the stock to “buy” and raising its price target to $184; the consensus rating is “Moderate Buy” with an average target of $169.50.
• The company reported strong quarterly results, earning $5.53 per share versus $2.66 expected, while revenue increased 52.7% year over year to $1.26 billion. Kaiser also maintains a $0.77 quarterly dividend, yielding about 2.0% annually.

Shares of Kaiser Aluminum Corporation (NASDAQ:KALU - Get Free Report) gapped up prior to trading on Monday . The stock had previously closed at $156.38, but opened at $163.24. Kaiser Aluminum shares last traded at $161.5420, with a volume of 28,878 shares changing hands.

Analyst Upgrades and Downgrades

Several research analysts have issued reports on the stock. Wall Street Zen raised shares of Kaiser Aluminum from a "buy" rating to a "strong-buy" rating in a research report on Sunday, August 2nd. Zacks Research upgraded shares of Kaiser Aluminum from a "hold" rating to a "strong-buy" rating in a research note on Wednesday, July 29th. Wells Fargo & Company raised their price target on Kaiser Aluminum from $158.00 to $169.00 and gave the stock an "underweight" rating in a report on Friday, July 24th. Weiss Ratings upgraded Kaiser Aluminum from a "buy (b-)" rating to a "buy (b)" rating in a research report on Tuesday, August 18th. Finally, UBS Group raised Kaiser Aluminum from a "neutral" rating to a "buy" rating and upped their price objective for the company from $179.00 to $184.00 in a research note on Monday. One analyst has rated the stock with a Strong Buy rating, three have assigned a Buy rating and two have given a Sell rating to the company's stock. According to MarketBeat.com, Kaiser Aluminum currently has a consensus rating of "Moderate Buy" and an average price target of $169.50.

Kaiser Aluminum Price Performance

The company has a market cap of $2.58 billion, a price-to-earnings ratio of 11.68 and a beta of 1.61. The company has a 50-day simple moving average of $169.70 and a 200-day simple moving average of $157.84. The company has a debt-to-equity ratio of 1.10, a quick ratio of 1.17 and a current ratio of 2.50.

Kaiser Aluminum (NASDAQ:KALU - Get Free Report) last posted its quarterly earnings results on Wednesday, July 22nd. The industrial products company reported $5.53 earnings per share for the quarter, beating analysts' consensus estimates of $2.66 by $2.87. Kaiser Aluminum had a return on equity of 24.71% and a net margin of 5.49%.The firm had revenue of $1.26 billion for the quarter, compared to the consensus estimate of $1.12 billion. During the same period in the previous year, the business earned $1.21 earnings per share. The company's revenue for the quarter was up 52.7% compared to the same quarter last year. As a group, research analysts predict that Kaiser Aluminum Corporation will post 10.63 earnings per share for the current year.

Kaiser Aluminum Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Friday, August 14th. Stockholders of record on Friday, July 24th were issued a $0.77 dividend. This represents a $3.08 dividend on an annualized basis and a dividend yield of 2.0%. The ex-dividend date was Friday, July 24th. Kaiser Aluminum's dividend payout ratio (DPR) is currently 22.83%.

Institutional Trading of Kaiser Aluminum

A number of institutional investors have recently added to or reduced their stakes in the stock. California State Teachers Retirement System increased its holdings in Kaiser Aluminum by 18,986.0% in the second quarter. California State Teachers Retirement System now owns 3,937,445 shares of the industrial products company's stock valued at $770,282,000 after buying an additional 3,916,815 shares in the last quarter. State Street Corp boosted its stake in shares of Kaiser Aluminum by 31.9% during the 2nd quarter. State Street Corp now owns 1,154,415 shares of the industrial products company's stock worth $92,238,000 after acquiring an additional 279,231 shares in the last quarter. Bank of New York Mellon Corp acquired a new stake in shares of Kaiser Aluminum in the 2nd quarter worth approximately $38,353,000. Hotchkis & Wiley Capital Management LLC acquired a new stake in shares of Kaiser Aluminum in the 3rd quarter worth approximately $13,111,000. Finally, Brightline Capital Management LLC purchased a new position in Kaiser Aluminum in the 4th quarter valued at approximately $19,296,000. Hedge funds and other institutional investors own 99.29% of the company's stock.

About Kaiser Aluminum

Kaiser Aluminum Corporation is a U.S.-based producer of semi‐fabricated aluminum products, serving a diverse range of industrial and specialty markets. The company's offerings include extruded, rolled, and forged aluminum products designed to meet stringent performance requirements in sectors such as aerospace, automotive, defense, electronics, and general engineering. By focusing on high‐value applications, Kaiser Aluminum aims to deliver lightweight, durable solutions that contribute to efficiency and innovation across its customer base.

Operationally, Kaiser Aluminum maintains a network of smelters, extrusion plants, and rolling mills located primarily in North America.

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