Kaiser Aluminum (NASDAQ:KALU) Stock Falls 6.3% Following Analyst Downgrade

Key Points

• Kaiser Aluminum shares fell 6.3% after Wells Fargo cut its price target from $160 to $125 while maintaining an “equal weight” rating. The stock traded near $107.76 on heavier-than-usual volume.
• Third-quarter revenue surged 43.9% year over year to $1.21 billion, but adjusted EPS of $1.89 missed estimates of $2.37. Higher metal costs and operational disruptions pushed net income down to $31 million from $39.5 million.
• Analyst sentiment remains mixed, with four Buy, two Hold and one Sell rating, producing an overall “Hold” consensus and average target of $162.40. The company maintained its outlook, declared a $0.77 quarterly dividend and is preparing for a CEO transition on November 1.

Kaiser Aluminum Corporation (NASDAQ:KALU - Get Free Report)'s share price dropped 6.3% during mid-day trading on Friday after Wells Fargo & Company lowered their price target on the stock from $160.00 to $125.00. Wells Fargo & Company currently has an equal weight rating on the stock. Kaiser Aluminum traded as low as $107.21 and last traded at $107.7570. 354,047 shares changed hands during mid-day trading, an increase of 43% from the average daily volume of 248,273 shares. The stock had previously closed at $114.99.

A number of other brokerages also recently commented on KALU. KeyCorp decreased their price objective on shares of Kaiser Aluminum from $183.00 to $181.00 and set an "overweight" rating for the company in a research report on Thursday, October 8th. UBS Group raised Kaiser Aluminum from a "neutral" rating to a "buy" rating and boosted their target price for the stock from $179.00 to $184.00 in a report on Monday, August 31st. Zacks Research cut Kaiser Aluminum from a "strong-buy" rating to a "hold" rating in a research note on Friday, September 25th. Weiss Ratings downgraded Kaiser Aluminum from a "buy (b)" rating to a "buy (b-)" rating in a report on Wednesday, September 2nd. Finally, 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. Four research analysts have rated the stock with a Buy rating, two have issued a Hold rating and one has given a Sell rating to the company. Based on data from MarketBeat, the company presently has an average rating of "Hold" and an average target price of $162.40.

Key Kaiser Aluminum News

Here are the key news stories impacting Kaiser Aluminum this week:

• Positive Sentiment: Management reported stronger aerospace demand, rising cash flow and better visibility into 2027. Kaiser also maintained its full-year 2026 outlook and expects conversion-revenue growth toward the high end of its 10%–15% target range. KALU Q3 Earnings Call Highlights Demand Strength & Margin Pressure
• Positive Sentiment: Third-quarter sales increased 43.9% year over year to approximately $1.21 billion, while shipments rose to 300.2 million pounds from 270.2 million. Operating income also improved to $55.2 million from $48.8 million. Kaiser Aluminum Corporation Reports Third Quarter 2026 Financial Results
• Positive Sentiment: The company declared its regular $0.77-per-share quarterly dividend, payable November 13, 2026, and reported total liquidity of $687 million.
• Neutral Sentiment: Fred Stephan is scheduled to replace Keith Harvey as president and chief executive officer on November 1, creating a near-term leadership transition that investors will monitor.
• Negative Sentiment: Adjusted third-quarter EPS of $1.89 missed consensus estimates, while net income fell to $31.0 million from $39.5 million a year earlier. Higher metal costs and operational disruptions compressed profitability despite the substantial increase in revenue. Kaiser Aluminum Misses Q3 Earnings Estimates
• Negative Sentiment: Wells Fargo lowered its price target from $160 to $125 and retained an “equal weight” rating, signaling reduced confidence in near-term upside. The new target still implies potential appreciation from recent levels. Wells Fargo Kaiser Aluminum rating

Institutional Inflows and Outflows

Institutional investors and hedge funds have recently added to or reduced their stakes in the company. Bank of New York Mellon Corp bought a new stake in shares of Kaiser Aluminum in the second quarter valued at about $38,353,000. Assenagon Asset Management S.A. acquired a new position in shares of Kaiser Aluminum in the second quarter valued at about $10,659,000. Great Lakes Advisors LLC bought a new position in Kaiser Aluminum during the second quarter worth about $8,045,000. Renaissance Technologies LLC increased its position in Kaiser Aluminum by 363.2% during the first quarter. Renaissance Technologies LLC now owns 33,814 shares of the industrial products company's stock worth $4,075,000 after acquiring an additional 26,514 shares during the period. Finally, Principal Financial Group Inc. raised its stake in Kaiser Aluminum by 32.4% in the 1st quarter. Principal Financial Group Inc. now owns 101,510 shares of the industrial products company's stock worth $12,233,000 after purchasing an additional 24,853 shares in the last quarter. 99.29% of the stock is owned by institutional investors and hedge funds.

Kaiser Aluminum Stock Down 6.3%

The company has a current ratio of 2.50, a quick ratio of 1.17 and a debt-to-equity ratio of 1.10. The firm's 50 day simple moving average is $154.82 and its two-hundred day simple moving average is $165.23. The firm has a market cap of $1.76 billion, a price-to-earnings ratio of 7.93 and a beta of 1.59.

Kaiser Aluminum (NASDAQ:KALU - Get Free Report) last announced its earnings results on Wednesday, October 21st. The industrial products company reported $1.89 earnings per share (EPS) for the quarter, missing analysts' consensus estimates of $2.37 by ($0.48). Kaiser Aluminum had a return on equity of 24.27% and a net margin of 4.85%. The business had revenue of $1.21 billion for the quarter, compared to analyst estimates of $1.21 billion. During the same quarter in the previous year, the company earned $1.86 EPS. The business's revenue for the quarter was up 43.9% on a year-over-year basis. On average, equities analysts forecast that Kaiser Aluminum Corporation will post 13.40 EPS for the current year.

Kaiser Aluminum Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Friday, November 13th. Shareholders of record on Friday, October 23rd will be paid a dividend of $0.77 per share. This represents a $3.08 dividend on an annualized basis and a yield of 2.9%. The ex-dividend date is Friday, October 23rd. Kaiser Aluminum's dividend payout ratio (DPR) is 22.83%.

About Kaiser Aluminum

Kaiser Aluminum Corporation is a producer of semi-fabricated aluminum products used by manufacturers in the aerospace and defense, automotive, industrial, and consumer products markets. The company supplies aluminum materials designed for applications that require strength, light weight, corrosion resistance, and other specialized performance characteristics.

Its product portfolio includes rolled aluminum sheet and plate, extruded products, forged components, and other fabricated aluminum products.

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