Alcoa’s 4Q15 earnings
Alcoa (AA) reported its 4Q15 earnings and full year financial results on January 11, 2016, after the close of market hours. It reported EPS (earnings per share) of $0.04 after adjusting for special items. In contrast, Alcoa had delivered an adjusted EPS of $0.07 in 3Q15 and $0.33 in 4Q14. Alcoa’s 4Q15 earnings have fallen on a sequential quarterly basis as well as on a yearly basis.
Earnings top Wall Street estimates
Alcoa’s 4Q15 earnings came in higher than average Wall Street expectations. Alcoa managed to beat earnings estimates after two quarters of missing consensus earnings. Nonetheless, the company’s earnings have been in a falling trend as can be seen in the graph above.
Alcoa was trading marginally lower in after-hours trading on January 11. On a year-to-date basis, Alcoa has fallen 19% so far in 2016. This comes after a negative price action of around 35% in 2015. Concerns over China’s slowdown negatively impacted the commodities space. Companies including Rio Tinto (RIO), Century Aluminum (CENX), and Norsk Hydro (NHYDY) have seen downward price action this year.
Investors looking at diversifying the risk of investing in a single security can also consider ETFs for their investment portfolios. The Materials Select Sector SPDR ETF (XLB) is an alternate way to play the materials space. Currently, Alcoa forms 2.4% of XLB’s portfolio.
In this series, we’ll explore Alcoa’s 3Q15 earnings in detail. We’ll discuss what factors could drive Alcoa’s earnings in the coming quarters. We’ll also cover the key points from the company’s 4Q15 earnings conference call.