Alcoa Quarterly Earnings ON DECK

S&P 500 (NYSE:SPY) component Alcoa (NYSE:AA) will unveil its latest earnings today, Monday, July 9, 2012. Alcoa is a global producer of aluminum. It is mainly engaged in the production and management of primary aluminum, fabricated aluminum, and alumina combined. It is actively involved in a range of industries, including technology, mining, smelting, and recycling.

Alcoa Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average estimate of analysts is for net income of 7 cents per share, a decline of 78.1% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from 12 cents. Between one and three months ago, the average estimate was unchanged. It has since dropped over the last month. For the year, analysts are projecting profit of 50 cents per share, a decline of 30.6% from last year.

Past Earnings Performance: The company beat estimates last quarter after falling short in the prior two. In the first quarter, the company reported net income of 10 cents per share versus a mean estimate of a loss of 4 cents per share. In the fourth quarter of the last fiscal year, the company missed estimates by 4 cents.

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A Look Back: In the first quarter, profit fell 69.5% to $94 million (9 cents a share) from $308 million (27 cents a share) the year earlier, but exceeded analyst expectations. Revenue rose 0.8% to $6.01 billion from $5.96 billion.

Wall St. Revenue Expectations: On average, analysts predict $5.83 billion in revenue this quarter, a decline of 11.4% from the year-ago quarter. Analysts are forecasting total revenue of $23.87 billion for the year, a decline of 4.3% from last year’s revenue of $24.95 billion.

Stock Price Performance: Between April 5, 2012 and July 6th, 2012, the stock price fell $.92 (-10.5%), from $9.63 to $8.71. The stock price saw one of its best stretches over the last year between March 6, 2012 and March 13, 2012, when shares rose for six straight days, increasing 8.9% (+84 cents) over that span. It saw one of its worst periods between May 1, 2012 and May 16, 2012 when shares fell for 12 straight days, dropping 14.8% (-$1.48) over that span.

Key Stats:

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 27% in the second quarter of the last fiscal year, 21.4% in the third quarter of the last fiscal year and 6% in the fourth quarter of the last fiscal year before increasing again in the first quarter.

Analyst Ratings: With seven analysts rating the stock as a buy, three rating it as a sell and six rating it as a hold, there are indications of a bullish outlook.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.25 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.28 in the fourth quarter of the last fiscal year to the last quarter driven in part by an increase in liabilities. Current liabilities increased 4.6% to $6.29 billion while assets rose 2.2% to $7.88 billion.

Competitors to Watch: Aluminum Corp. of China Limited (ADR), Kaiser Aluminum Corp., Alumina Limited (ADR), Noranda Aluminum Holding Corporation, and Century Aluminum Co.

(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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