Alcoa (NYSE:AA) Shares Gap Down – Time to Sell?

Alcoa (NYSE:AA) gapped down prior to trading on Wednesday . The stock had previously closed at $52.14, but opened at $48.85. Alcoa shares last traded at $47.2770, with a volume of 2,802,607 shares changing hands.

Key Alcoa News

Here are the key news stories impacting Alcoa this week:

• Positive Sentiment: Alcoa announced a major acquisition of South32’s bauxite, alumina, and aluminum assets for about $4.1 billion upfront, a move that expands its upstream footprint and could strengthen its long-term position in aluminum production. Article Title
• Positive Sentiment: Citi reiterated a Buy rating on Alcoa and kept its $76 price target, saying the acquisition could drive upside if the integration goes well. Article Title
• Neutral Sentiment: Media coverage highlighted Alcoa as one of the key stock movers before the open, but broader market weakness and a pullback in technology shares were also weighing on sentiment overall. Article Title
• Negative Sentiment: Investors may be focused on execution and financing risks from the South32 deal, since the transaction is large and could add integration complexity even if it is strategically attractive.

Analyst Upgrades and Downgrades

AA has been the subject of several research analyst reports. Wells Fargo & Company reduced their price target on shares of Alcoa from $82.00 to $71.00 and set an “overweight” rating for the company in a research report on Thursday, June 25th. Argus set a $73.00 price objective on Alcoa in a research note on Monday, April 27th. Morgan Stanley set a $79.00 target price on Alcoa in a report on Thursday, June 11th. Royal Bank Of Canada set a $70.00 target price on Alcoa in a research report on Wednesday. Finally, B. Riley Financial boosted their price target on Alcoa from $78.00 to $96.00 and gave the stock a “buy” rating in a research report on Tuesday, April 7th. Six investment analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat, the stock currently has an average rating of “Hold” and a consensus price target of $67.82.

Alcoa Price Performance

The stock’s 50-day moving average price is $66.01 and its 200 day moving average price is $62.72. The company has a quick ratio of 0.88, a current ratio of 1.48 and a debt-to-equity ratio of 0.36. The firm has a market capitalization of $12.53 billion, a price-to-earnings ratio of 12.04 and a beta of 1.56.

Alcoa (NYSE:AA) last posted its quarterly earnings results on Thursday, April 16th. The industrial products company reported $1.40 earnings per share for the quarter, missing analysts’ consensus estimates of $1.60 by ($0.20). The business had revenue of $3.19 billion for the quarter, compared to analyst estimates of $3.35 billion. Alcoa had a return on equity of 12.57% and a net margin of 8.27%.The business’s revenue was down 5.2% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $2.15 earnings per share. Equities research analysts expect that Alcoa will post 7.54 earnings per share for the current fiscal year.

Alcoa Announces Dividend

The business also recently announced a quarterly dividend, which was paid on Friday, June 5th. Stockholders of record on Tuesday, May 19th were issued a dividend of $0.10 per share. This represents a $0.40 annualized dividend and a dividend yield of 0.8%. The ex-dividend date was Tuesday, May 19th. Alcoa’s payout ratio is currently 10.13%.

Institutional Investors Weigh In On Alcoa

Several hedge funds and other institutional investors have recently made changes to their positions in the stock. Nordea Investment Management AB boosted its holdings in Alcoa by 187.7% in the fourth quarter. Nordea Investment Management AB now owns 408,624 shares of the industrial products company’s stock valued at $21,902,000 after purchasing an additional 266,574 shares during the period. Lighthouse Investment Partners LLC acquired a new stake in Alcoa in the 3rd quarter valued at about $5,606,000. Moran Wealth Management LLC purchased a new position in shares of Alcoa in the 4th quarter valued at about $2,631,000. Regal Partners Ltd boosted its stake in shares of Alcoa by 7.0% in the 3rd quarter. Regal Partners Ltd now owns 451,940 shares of the industrial products company’s stock valued at $14,864,000 after buying an additional 29,612 shares during the period. Finally, Merit Financial Group LLC grew its position in shares of Alcoa by 114.2% during the fourth quarter. Merit Financial Group LLC now owns 28,945 shares of the industrial products company’s stock worth $1,538,000 after buying an additional 15,432 shares in the last quarter.

About Alcoa

Alcoa Corporation is a global industry leader in the production and management of aluminum, offering an integrated value chain that spans bauxite mining, alumina refining, primary aluminum smelting and the fabrication of value-added products. The company’s operations are organized into segments that include raw material extraction, chemical processing and the manufacture of metal mill products and engineered solutions.

Alcoa’s product portfolio serves diverse end markets such as aerospace, automotive, packaging, construction, electrical and industrial applications.