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Can Alcoa’s 4Q17 Earnings Keep Investors’ Optimism Alive?

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Alcoa’s 4Q17 earnings

Alcoa (AA), the leading US-based aluminum producer (XME), is expected to release its 4Q17 earnings on January 17. In this series, we’ll see what analysts are projecting for Alcoa’s 4Q17 results. We’ll also look at the different factors that could impact Alcoa’s 4Q17 performance and see how analysts are rating Alcoa and other aluminum producers this earnings season.

Price action

Looking at price action, we see that 2017 was a great year for Alcoa. The stock gained 91.2% last year, piggybacking aluminum prices. Aluminum prices gained 32.9% last year, preceded by a 12.3% rise in 2016. Other aluminum producers—including Century Aluminum (CENX), Norsk Hydro (NHY), and South 32 (S32)—also saw upward price action last year as earnings improved amid higher metal prices. Last year, better-than-expected global demand supported aluminum prices. Capacity cuts in China also helped buoy aluminum market sentiments. Alcoa has continued its uptrend in 2018 as well. Based on January 10 closing prices, the stock is up 4.3% this year.

Meanwhile, while metal prices tend to be the key price driver for companies in the metals and mining space, earnings could take center-stage this month. With Alcoa’s 4Q17 earnings around the corner, let’s see what analysts expect from the company’s 4Q17 financial performance. We’ll begin by analyzing Alcoa’s 4Q17 revenue estimates.

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