Alcoa Inc (AA): Today's Featured Metals & Mining Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Alcoa ( AA) pushed the Metals & Mining industry lower today making it today's featured Metals & Mining laggard. The industry as a whole closed the day down 1.1%. By the end of trading, Alcoa fell 26 cents (-2.8%) to $9.06 on average volume. Throughout the day, 23.6 million shares of Alcoa exchanged hands as compared to its average daily volume of 16.7 million shares. The stock ranged in price between $9.05-$9.32 after having opened the day at $9.31 as compared to the previous trading day's close of $9.32. Other companies within the Metals & Mining industry that declined today were: China Precision Steel ( CPSL), down 20%, Pacific Booker Minerals ( PBM), down 14.9%, Timberline Resources Corporation ( TLR), down 10.6%, and Quest Rare Minerals ( QRM), down 10.3%.
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Alcoa Inc. engages in the production and management of primary aluminum, fabricated aluminum, and alumina. The company operates in four segments: Alumina, Primary Metals, Flat-Rolled Products, and Engineered Products and Solutions. Alcoa has a market cap of $9.95 billion and is part of the basic materials sector. The company has a P/E ratio of 51.8, above the S&P 500 P/E ratio of 17.7. Shares are up 7.4% year to date as of the close of trading on Friday. Currently there are five analysts that rate Alcoa a buy, four analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates Alcoa as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, disappointing return on equity and weak operating cash flow.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the metals & mining industry could consider SPDR S&P Metals & Mining ETF ( XME) while those bearish on the metals & mining industry could consider PowerShares DB Base Metals Sht ETN ( BOS).

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