Alcoa Inc (NYSE:AA) reported surprisingly good earnings yesterday afternoon after the market closed. The company’s stock shot up in aftermarket trading and opened this morning at $8.25 per share. The earnings results might not be as positive as the market believes, however, and a Deutsche Bank report calls the numbers a “once-off.”

Alcoa

Alcoa revealed earnings of 11 cents per share on revenue of $5.77 billion. Analysts were expecting the company to earn just 5 cents per share on revenue of $5.7 billion by consensus. There were two major contributors to the earnings beat, according to the DB report, and neither of those is a trend investors should bet on, according to the piece.

Alcoa, productivity, and foreign exchange

Foreign exchange rates were one of the trends that resulted in more favorable results. Alcoa Inc (NYSE:AA) benefited better than expected during the September quarter. That move helped the company’s primary metals segment to earn up to $38 million extra, according to the DB analysts. The total earnings form the primary metals segment hit $138 million.

The analysts also highlight surprise productivity gains as a reason for the company’s EPS beat. Alcoa Inc (NYSE:AA) has been trying to restructure and improve productivity in recent months. That’s happening faster than expected, but it is not something the DB report recommends banking on.

The real problem at Alcoa Inc (NYSE:AA) is the price of aluminum. Short-term foreign exchange benefits are not going to change the price of the metal on the world market. Because of expected increases in supply of the metal in the coming year, the DB analysts rate Alcoa Inc (NYSE:AA) a Sell with a price target of $5.50.

Alcoa supply pressures

In the view of the analysts who authored this report, there will be pressure on the price of aluminum in the coming months, and that’s bad for Alcoa Inc (NYSE:AA). The company is trying to shift more of its business to value-added products rather than primary metals, but that change is not happening quickly enough.

The fourth quarter will be weaker than this one, according to the analysts. They see earnings per share coming in at around 1 cent in the next earnings report. Alcoa Inc (NYSE:AA) capital expenditure is likely to suffer, and its stock price is likely to suffer along with it.