NEW YORK (TheStreet) -- Aluminum for delivery within three months has lost 18% during the last two months on the London Metal Exchange. Subsequently, aluminum stocks, including Alcoa (AA), Kaiser Aluminum (KALU), Century Aluminum (CENX), Alumina (AWC), and Aluminum Corp of China (ACH) have declined 21%, 11%, 34%, 13% and 23%, respectively.

Based on fundamental reasons, Kaiser Aluminum and Century Aluminum seem attractive buys. Kaiser is trading at a forward price-to-earnings ratio of 23.77, while Century Aluminum is trading at a P/E of 9.57.

During the first quarter, the average price of aluminum stood at about $2,200 per ton. Average aluminum prices for the second quarter to date stand at $2,144 per ton.

Assuming Friday's closing price as an average price for the rest of the quarter, aluminum prices will end the second quarter at an average price of $2,107 per ton, implying a quarter over quarter drop of 4%.

Moreover, if we look at the sales estimates of these stocks given by analysts there have been no major revisions made during the last two months, suggesting that this decline in aluminum prices was expected and has been factored in the revenue guidance. Although Kaiser has only declined 11%, the selloff in Century Aluminum seems overdone.

Kaiser's current revenue estimates of $280 million for the second quarter reflect a negligible drop in sales volume. For the third and fourth quarter, going by volume and aluminum price estimates, revenue is estimated to be $292 million and $295 million, respectively.

According to Bloomberg estimates, revenue for the second quarter was revised upwards from $268 million in April to $280 million as of June 7, implying a 4.5% increase. This is despite a 21% drop in aluminum prices during the same period.

On June 1, UBS rated the stock a buy with price target of $44, representing a 13% upside over current levels.

Century Aluminum, on the other hand, has witnessed a 38% drop in its stock price. According to Bloomberg estimates, revenue for the second quarter was revised downwards from $308 million in mid-April to $299 million as of May 25, implying a 3% decrease. For the third and fourth quarter, going by volume estimates, revenue is estimated to be $295 million and $302 million, respectively

Recently, BMO Capital Markets rated the stock a buy with price target of $15, implying a 50% upside over current levels.

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