NYSE: AA

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A Spin-Off and a Second Catalyst Will Make These Shares Soar

By , Defense + Tech Specialist, Money Morning • @Robinson_STI -

spin-off

It looks like a terrible time to invest anywhere near the materials space. Sell-offs have tanked the price of gold and silver, along with industrial metals like copper and nickel, and even commodities like cotton.

But there's one materials play that will allow you to buck that trend. It's a "pure play" on metals that is all but guaranteed to return double digits thanks to an upcoming spin-off and a second major catalyst.

Here's how to invest in this materials firm before its shares soar...

Alcoa (NYSE: AA) Earnings Beat Boosts Stock, but Don't Expect the Same from the Sector

By , Associate Editor, Money Morning • @JimBach22 -

Alcoa Inc. (NYSE: AA) earnings solidly beat analyst expectations to kick off the season, but don't get too excited.

Often regarded as a bellwether and tone setter for earnings season, AA's positive financial results are not going to permeate throughout the basic materials sector, which is likely to see trouble this quarter at the hands of falling commodity prices.

But AA has a luxury that many of these producers don’t have, making it the exception, not the rule.

Earnings Reports Calendar: 5 to Watch This Week

By , Contributing Writer, Money Morning -

The earnings reports calendar is getting crowded as some big names deliver numbers this week - and investors will get to see if a harsh winter hurt Q1 results this season.

S&P 500 companies' Q1 earnings are forecast to have fallen 1.4% year over year, according to data from FactSet. That's down sharply from the start of the year, when profit growth was projected to rise 4.5%.

Alcoa (NYSE: AA) Stock Falls in After-Hours on Q4 Earnings Loss

By , Associate Editor, Money Morning • @KyleAndersonMM -

Alcoa Inc. (NYSE: AA) stock rose 2.9% yesterday (Wednesday) ahead of today's fourth-quarter earnings report due after the bell.

Analysts are projecting earnings of $0.06 per share, down from $0.11 last quarter. At $5.54 billion, revenue estimates for AA are in line with the consensus estimate.

Alcoa used to be an earnings bellwether, although is no longer considered as one. Still, its earnings report is considered the official start to earnings season and is monitored for clues to global economic health.

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Big Dow Index Changes: What They Mean for Your Stocks

By , Contributing Writer, Money Morning -

Today's Penny Stock Earnings

The dumping of Alcoa, Hewlett-Packard, and Bank of America from the Dow Jones Industrial Average in favor of newcomers Nike, Visa, and Goldman Sachs is the biggest change to the index in nearly a decade. Here's what investors need to know about this shake-up...
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Stock Market Today: Is this 9% Gainer a Recession-Proof Winner?

By , Money Morning -

The stock market today opened lower as investors enter the third-quarter earnings season feeling very pessimistic. Alcoa's report yesterday and Chevron's announcement today only intensified this sentiment, but there is one stock that is proving to be a winner.

  • Alcoa Inc. (NYSE: AA) reports a loss to start earnings season- Alcoa reported a net loss of $143 million, or 13 cents a share for the third quarter, a reversal of last year's third-quarter profits of $172 million, or 15 cents a share. Sales fell as well, dropping 9.2% to $5.83 billion from $6.42 billion. Alcoa, the largest U.S. aluminum producer, was hurt by declining demand and aluminum prices that are 20% lower than a year ago. The company now expects aluminum demand will rise 6% this year, lower than the 7% forecast made in July. The silver lining for Alcoa is that the numbers weren't as bad as expected. Excluding environmental and legal charges the company posted a profit of 3 cents per share, ahead of Wall Street's estimate to break even. Even though sales fell they too beat projections. "The global economy is clearly slowing," Lloyd O'Carroll, a Richmond, Virginia-based analyst for Davenport & Co., told Bloomberg News yesterday. "That's what the IMF said today and so I think what Alcoa is doing is consistent with that." AA stock was down almost 4% as of noon.
  • Chevron Corp (NYSE: CVX) announces 3Q results will stumble- Chevron said on Tuesday that it expects third-quarter earnings to be "substantially lower" than its second-quarter results. The San Ramon, CA-based company cited lower production and a lower price of oil for the decline in profits. For the months of July and August the average price of a barrel of oil in the U.S. was $95.44 compared to $103.91 in the April-June quarter. Last quarter the company earned $7.2 billion, or $3.66 per share and analysts expect net income of $6.2 billion, or $3.08 per share for the third quarter. Chevron, the second-largest U.S. energy company by market value, will release full third-quarter results on Nov. 2. CVX stock is down 3.5% as of noon.
Finally, this stock is looking like it can withstand weakening growth in 2013.

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Alcoa Earnings Report Uneasy Start to Second Quarter (NYSE: AA)

By , Contributing Writer, Money Morning -

Investors already have a cautious stance in the market amid growing fears about the world's biggest economies, and Monday's Alcoa (NYSE: AA) earnings report didn't help.

The aluminum producer, which always kicks off the earnings season, delivered more of a punt than a kickoff. The Dow bellwether reported an 81.3% drop in profits, as the global slowdown and production cuts weighed on profits.

Reporting after Monday's market close, Alcoa said income from continuing operations came in at $61 million, or 6 cents a share, on revenue just a hair under $6 billion. While significantly lower than the same period a year ago, the lackluster results still managed to beat Wall Street's tepid expectations (analysts were looking for 5 cents on revenue of $5.8 billion).

Chairman and CEO Klaus Kleinfeld said in a statement following the earnings release, "Alcoa maintained revenue strength amid solid liquidity by driving high profitability in our mid and downstream businesses and by reducing costs and improving performance in our upstream businesses."

Contributing to the profit decline was a global glut resulting from stagnant and slowing growth in many areas around the world, especially China.

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Alcoa (NYSE: AA) Kicks Off First Quarter Earnings Reports That Could Put Brakes on Market Rise

By , Money Morning -

Investors will get a front row preview to the first quarter earnings season when bellwether Alcoa Inc. (NYSE: AA) reports its results Tuesday after the close.

The aluminum producer is the first major U.S. company to release its first quarter earnings report, and these closely watched results often set the tone for the earnings season.

But investors shouldn't get their hopes up - expectations for first quarter earnings are low.

Earnings growth for the first three months of 2012 was lackluster at best - even though the stock market produced some of the best quarterly market gains since 1998. The Dow rose some 8%, the Standard & Poor's 500 Index gained 12%, and the NASDAQ nearly climbed a whopping 19%.

If this latest batch of earnings comes with a plethora of nasty and unwelcome surprises, the recent market rally could be derailed.

Sam Stovall, chief equity strategist at S&P Capital told the Associated Press, "It's supposed to be a very weak quarter, but Wall Street is freaking out because they don't understand why."

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