NEW YORK ( TheStreet) -- Alcoa ( AA) is expected to surpass Wall Street profit expectations when the aluminum giant reports fourth-quarter results after the close Monday.
Aluminum prices on the London Metals Exchange rose by nearly 8% between the end of the third quarter and the end of the fourth, which should pad profits for aluminum producers. Despite the climb, many analysts haven't updated their earnings targets since October. The Wall Street consensus is calling for Alcoa to report a profit of 20 cents a share for the fourth quarter, according to Thompson Reuters, with a range of between 16 cents and 30 cents. Analysts see revenue coming in at $5.68 billion. A year ago, Alcoa earned a penny a share on revenue of $5.43 billion. Market watchers also grew bullish after Alcoa announced on Friday that it would reopen three U.S. smelters shuttered during the recession. The thinking appears to be that the announcement wasn't a coincidence, and that Alcoa will likely hike its demand outlook for 2011 when it releases results after the close. Shares of the aluminum giant -- traditionally the first blue-chip company to report financials each quarterly earnings season -- were trading Monday afternoon at $16.51, up 9 cents, or 0.6%, on heavier-than-average volume. Analysts are expecting improvement in most of Alcoa's so-called "downstream" businesses, or those that make finished aluminum products, such as airplane parts or soda cans, as the U.S. economy recovers and emerging economies continue to outperform.