Alcoa Inc. (NYSE:AA) released its earnings report today, Tuesday January 8, after the market closed. The company announced earnings per share of $0.06, and revenues of $5.9 billion. The company's result are often used by investors as a proxy for all industrial stocks because its products have wide industry demand, and its earnings are released early in the season. The firm beat estimates of its revenue, and its earnings per share was in line.
Today's earnings come in the midst of a gripping earnings season. Investors are nervous about the supposed recovery in the US economy, and its effect on corporate earnings. Alcoa Inc. (NYSE:AA) shares closed today at $9.13 up 0.33%. After market trading, based on the firm's earnings and the coming conference call, have not made any real change to the stocks prices of yet.
The company earned $0.72 per share for the full year 2011. The firm had revenue of $25 billion in the same year. The 2011 revenues came in more than 18% over 2010 revenues. This years results are disappointing in comparison.
Analysts are recommending, overall, that investors hold onto Alcoa Inc. (NYSE:AA) shares. The firm's stock is not expected to move much in the future, but if economic growth does return in a persuasive way, the company's earnings are expected to take off. Alcoa shares didn't change much in the course of 2012. The firm's stock price finished just 0.82% below where it started the year.
Analysts were expecting Alcoa Inc. (NYSE:AA) to earn around 6 cents per share and bring in revenue of around $5.64 billion. The company is not known for big surprises, but it can still surprise at times. The firms' third quarter numbers came in at 3 cents. Analysts had forecast earnings per share of $0.
In the days leading up to the announcement of fourth quarter results, Alcoa Inc. (NYSE:AA) saw its stock price trend upward. In the last month, the stock's price has increased by just over 7%. More than 5% of that increase has come in the last five days.
The repercussions of the Alcoa Inc. (NYSE:AA) earnings are usually expected to weigh heavily on the other industrial stocks in the Dow Jones Industrial Average, DJIA. Alcoa produces a commodity aluminum, which is widely used in many markets. This, coupled with its announcement of earnings early in the season, make today's numbers a thermometer for the rest of that index.
The most important things to keep track of f studying Alcoa are the price of aluminum, the expected price of aluminum, and the company's restructuring and cost cutting progress. If the world economy swings majorly upward, or downward, the company's demand will follow.
Alcoa Inc. (NYSE:AA) had the benefit of high aluminum prices during the fourth quarter of 2012, that is responsible for a bump in the firm's revenue this time around. Those pries may drop this year, due to rising inventories. 2013 could be a tough one for Alcoa.
Earnings season has officially started with the release of the Alcoa numbers, the next few weeks are going to be jam packed with figures for investors, with the really big announcements beginning next week.