NEW YORK (TheStreet) -- Alcoa (AA) shares are getting a lift, up by 0.49% to $6.90 on Monday afternoon, after hedge fund Elliott Management raised its stake in the aluminum maker to 7.4% from 6.4%, the Wall Street Journal reports.
The New York hedge fund in November had accumulated a 6.4% stake in the company following Alcoa's decision in September to separate into two publicly traded companies.
At the time, Alcoa, grappling with lower alumina and aluminum prices, said that the company keeping the Alcoa name will focus on upstream products, including five business units--bauxite, alumina, aluminum, casting and energy. The other company will focus on engineered products, which include the aerospace and automotive segments.
According to the Securities and Exchange Commission, Elliott from mid-December through last week had purchased more Alcoa shares, noting that the spinoff "will create value substantially above the current share price," the Journal added.
Two weeks ago, the company reported its fourth quarter fiscal 2015 earnings results. Profit of 4 cents a share came in above expectations of 2 cents a share, while revenue of $5.25 billion was slightly under forecasts of $5.29 billion.
Separately, TheStreet Ratings currently has a Hold rating on the stock with a letter grade of C-.
Despite the weak revenue results, Alcoa has outperformed against the industry average of 46.1%. Since the same quarter one year prior, revenues fell by 17.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: AA