Alcoa Inc (NYSE:AA) is set to report its first quarter earnings after the markets close today, and as the first company to report its earnings, all eyes will be watching. Consensus is that the company’s earnings per share will be a little lower than they were last year.
Of course Alcoa Inc (NYSE:AA) has been struggling as the global economy has slowed. The industrial sector also has yet to recover since the 2008 recession. In addition, aluminum prices have been weak over the last few months thanks to a massive global oversupply, which could drag the company’s earnings down.
The Wall Street Journal reports that the metal industry as a whole is suffering as an oversupply keeps prices low. Meanwhile Alcoa Inc (NYSE:AA) has been closing production lines and smelters in an effort to reduce its production. The company has also added some new products like blots, screws and other parts, specifically for the aerospace industry.
This will improve the company’s position as the automotive and commercial airplane markets improve. By offering aerospace parts, Alcoa Inc (NYSE:AA) will be able to diversify its profit portfolio so that it addresses a rapidly improving market.
Also the U.S. automotive industry could push aluminum demand higher as automakers look to aluminum to provide a lighter alternative to steel. Lighter vehicles are more fuel efficient, and the U.S. government has been tightening controls on fuel efficiency in recent years.
According to FactSet, Alcoa Inc (NYSE:AA)’s adjusted earnings per share is expected to be 8 cents per share on $5.91 billion in revenue. At the moment of this writing, shares of Alcoa Inc (NYSE:AA) were up .12 percent at the New York Stock Exchange.