Pre-Market Laggard: Alcoa (AA)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Alcoa ( AA) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Alcoa as such a stock due to the following factors:

  • AA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $233.6 million.
  • AA traded 211,028 shares today in the pre-market hours as of 9:29 AM.
  • AA is down 2% today from Friday's close.

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More details on AA:

Alcoa Inc. produces and manages primary aluminum, fabricated aluminum, and alumina. The company operates in four segments: Alumina, Primary Metals, Global Rolled Products, and Engineered Products and Solutions. The stock currently has a dividend yield of 0.7%. Currently there are 7 analysts that rate Alcoa a buy, 1 analyst rates it a sell, and 7 rate it a hold.

The average volume for Alcoa has been 15.2 million shares per day over the past 30 days. Alcoa has a market cap of $19.9 billion and is part of the basic materials sector and metals & mining industry. The stock has a beta of 1.45 and a short float of 6.2% with 4.22 days to cover. Shares are up 57.3% year-to-date as of the close of trading on Friday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Alcoa as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, growth in earnings per share and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the ratings report include:
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Metals & Mining industry. The net income increased by 216.0% when compared to the same quarter one year prior, rising from -$119.00 million to $138.00 million.
  • Powered by its strong earnings growth of 209.09% and other important driving factors, this stock has surged by 118.11% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • ALCOA INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ALCOA INC swung to a loss, reporting -$2.15 versus $0.17 in the prior year. This year, the market expects an improvement in earnings ($0.60 versus -$2.15).
  • Net operating cash flow has remained constant at $518.00 million with no significant change when compared to the same quarter last year. Along with maintaining stable cash flow from operations, the firm exceeded the industry average cash flow growth rate of -21.40%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 0.6%. Since the same quarter one year prior, revenues slightly dropped by 0.2%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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