Alcoa Earnings Fall Short of Estimates – Shorts Favored On Weak Results And Company Break Up
Shares of Alcoa Inc. dropped more than 10% on Tuesday after the metals manufacturer disappointed markets by reporting a worse-than-anticipated quarterly earnings result.
Kicking off the third-quarter earnings season, Alcoa reported net profit of $166 million, or 33 cents per share. Profits were up from $44 million, or 6 cents per share in the same period one year ago, but missed expectations calling for earnings per share of 35 cents.
Alcoa’s revenue fell to $5.21 billion from $5.57 billion in the same quarter a year ago, as a result of lower production in its traditional smelting operation. The advance in profits at the New York-based company resulted from cost-cutting measures and lower income tax provisions.
This is Alcoa’s last quarterly report before it splits into two separate entities – one focussing on the traditional smelting business, and the other on higher-end aluminum and titanium alloys.
Alcoa Trade suggestion
Sell Stop at 28.25, Take profit at 26.00, Stop loss at 30.00