How Markets See Aluminum Producers after Their 3Q17 Earnings
We’re towards the end of the 3Q17 earnings season. Most aluminum producers have already released their 3Q17 results. Since companies are providing their quarterly earnings, leading diversified miners like Rio Tinto (RIO) have only provided their quarterly operating performance.
Looking at other aluminum producers (XLB), Alcoa (AA) released its 3Q17 earnings on October 18 after the markets closed. Norsk Hydro (NHY) released its 3Q17 earnings on October 25, followed by Century Aluminum’s (CENX) 3Q17 earnings on October 26.
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Overall, 2017 has been a strong year for companies in the metals and mining space. Commodities have built on their 2016 gains. The LME three-month aluminum contract has risen 27.5% in 2017—based on the closing prices on November 7. Alumina, which is processed more to produce aluminum, recently hit an all-time high. Higher metal prices have boosted aluminum producers’ price action. They’re trading with strong yearly gains. Alcoa and Century Aluminum are trading with year-to-date gains of 67.2% and 72.9%, respectively.
Generally, analysts reassess their recommendations and target prices following a company’s earnings release to reflect the earnings and guidance provided by the company’s management. In this series, we’ll discuss how analysts are rating leading aluminum producers after their 3Q17 earnings release. We’ll also see how analysts changed their recommendations after the 3Q17 earnings.
In the next part, we’ll discuss Alcoa’s ratings and target price.