Alcoa stock has dropped 60% due to declining earnings and lower aluminum prices

From Nasdaq: 2025-01-05 21:15:15

Alcoa (NYSE:AA) stock has dropped almost 60% since its peak in March 2022, underperforming its peers such as Century Aluminum Co (NASDAQ:CENX) and Kaiser Aluminum Corp (NASDAQ:KALU). Aluminum prices have also fallen from $4,000 per metric ton to $2,580 due to various macroeconomic factors and a slowdown in China’s demand.

Alcoa’s earnings have declined significantly, with EBITDA dropping from $2.2 billion in 2022 to $0.5 billion in 2023. The company’s revenues also fell by about 15% during the same period. This was mainly due to lower realized prices for aluminum and alumina, along with higher production costs.

Despite the recent challenges, Alcoa’s stock is expected to perform better in the future. Rising alumina prices, increased aluminum production, and recent acquisitions are positive signs for the company. Additionally, Alcoa’s focus on operational efficiency and sustainability could lead to improved long-term profitability.

Analysts value Alcoa stock at around $46 per share, which is 25% higher than the current market price. The company’s efforts to reduce carbon emissions and invest in green technologies could further enhance its sustainability profile and long-term competitiveness. The future demand for aluminum in various industries also bodes well for Alcoa’s growth prospects. 1. The World Health Organization reported a record high of over 400,000 new COVID-19 cases in a single day, with the global death toll surpassing 1 million. The Americas continue to be the hardest hit region, with Europe and Asia also experiencing spikes in cases.

2. In economic news, the U.S. unemployment rate dropped to 7.9% in September, with 661,000 jobs added to the economy. This marks the fifth straight month of job growth, though concerns remain over the pace of recovery and the potential impact of a second wave of COVID-19.

3. Tech giant Apple announced a new line of 5G-enabled iPhones, with prices ranging from $699 to $1,099. The new iPhones boast faster speeds, improved cameras, and longer battery life. Analysts predict strong sales for the new devices, which are set to hit the market in the coming weeks.



Read more at Nasdaq: Why Alcoa Stock Fell 60%?