How Wall Street Analysts View Alcoa Stock




Alcoa (AA) released its 1Q17 earnings on April 24, 2017. Analysts generally revise their target prices and recommendations after a company’s earnings release to reflect the earnings and outlook provided by its management.

Notably, Alcoa was able to beat consensus earnings estimates. The management’s commentary on the aluminum market and Alcoa’s position in the aluminum industry also looked promising. You can read Alcoa Posts Earnings Beat and Positive Outlook in 1Q17 for a detailed analysis of Alcoa’s 1Q17 earnings. In this article, we’ll see what analysts recommend for Alcoa after its 1Q17 earnings release.

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Consensus price target

According to consensus estimates compiled by Thomson Reuters, Alcoa has a mean one-year price target of $42.44, representing a 25.8% upside over its closing price on April 28, 2017. In contrast, Alcoa carried a one-year price target of $42.70 on April 23, one day before its earnings release.

There has been no major analyst action after Alcoa’s 1Q17 earnings release. However, several brokerages such as J.P. Morgan, Morgan Stanley, and Deutsche Bank upgraded Alcoa after its 4Q16 earnings release.

Analysts are bullish

Nevertheless, the consensus view seems to be bullish for Alcoa. Of the 12 analysts surveyed by Thomson Reuters, nine analysts recommended Alcoa stock as a “buy” or some equivalent, while the remaining three analysts recommended the stock as a “hold.” None of the analysts recommended Alcoa as a “sell.” 

Among other aluminum producers (RIO) (XLB), Norsk Hydro (NHYDY) and Century Aluminum (CENX) received “sell” ratings from 9% and 25% of the analysts, respectively.

Notably, analysts’ views reflect their opinions about Alcoa as well as the aluminum industry in general. In the next article, we’ll see what leading market observers are projecting for aluminum prices.


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