Are Alcoa Corporation (AA) Shares Set to Sail or Sink?

On December 03, 2019, Alcoa Corporation (NYSE:AA) shares lost -2.66% or -0.54 points to close at $19.79 with a thin trading volume of 3.054 million shares. It opened the trading session at $19.97, the shares rose to $20.01 and dropped to $19.52, the range by which the price of stock traded the whole day. The company now has a market cap of $3.72 billion and currently has 187.85 million outstanding shares. Alcoa Corporation (AA) stock has plunged -9.51 percent of market value in 21 trading days.

AA stock’s trailing 3-year beta is 0, meaning there will be a lower rate of return, although posing a lower risk. The part of a firm’s profit given to each outstanding share of regular stock was -$4.2 share in the trailing 52 weeks. The stock’s value fallen -25.55 percent year to date (YTD) compared to a decline of -37.79 percent in 52 week’s period. The firm’s shares are still trading -40.87 percent below its 1-year high of $33.47 and 20.23 percent up from 52-week low of $16.46. The average consensus ranking on the company is 2.6, on a ranging where 5 is equal to a consensus sell rating. In other words, the mean analyst recommendations are ranking this stock as a sell.

Alcoa Corporation (AA) is most likely going to rise 28.45 percent in the coming 12 months, as per price target approximations compiled by finviz. Nevertheless, they have set the price target at a $30-month high price target. This represents a whopping 51.59 percent increase from the current trading of shares. The 52-week median price target given by the analysts is $25, which means a return possibility of 26.33 percent in comparison with the closing price of the stock of $19.79 on December 03. The lowest price set for the stock is $21 — just above 6.11 percent from AA share price now.

Past records have indicated that shares in Alcoa Corporation declined on 22 different earnings reaction days and we have yet to see whether this trend will play out and remain in place when the company reports upcoming earnings. Investors will get the next hint of AA’s Q4 earnings on January 15. Analysts are predicting revenue to suffer decline of -25.2 percent to $2.5B in the financial fourth quarter, while EPS will soar by about -134.85 percent to -$0.23 per share. In the last quarter, it earnings of -$0.01 per share came better than the -$0.29257, adjusted, expected by Thomson Reuters consensus estimate. Revenue for the quarter was $2.57B, missing the $2.58B analysts had expected. Earnings are seen to rise by -6 percent this year, 210.8 percent in the coming year.

Let’s take a glimpse at some insider activity at Alcoa Corporation (NYSE:AA) and observe the pattern. The earliest insider trade happened on 01/31/2018. Sigurdsson Tomas Mar parted with a total of 10 thousand shares of the firm at average share price of $51.37. The total amount for the sale was set at $513.7 thousand. On completing this exchange, the Exec VP and COO account balance was 46.83 thousand shares. The stock lost -61.48 percent from that insider sale. On 01/22/2018, Oplinger William F, Executive VP & CFO, did a sale of 229.48 thousand shares at a price of $52.86 per share. This got rid of 12.13 million shares from the insider’s fortune and the stock experienced a -62.56 percent retreat in price since the news became public. This exchange saw 102.63 thousand shares get out from the Executive VP & CFO account.

On 02/14/2017, Former 10% owner Arconic Inc. recorded a sale transaction valued at $888.11 million. The sale at $38.03 a share has eliminated 23.35 million shares from the insider’s portfolio position. Meanwhile, shares price witnessed -47.96 percent decrease since the transaction reporting date. The company insider is left with 12.96 million shares remaining in the account. Heeter Jeffrey D., who works as EVP, Gen. Counsel & Secretary at the company, performed a sale of 3.75 thousand shares in a transaction worth $140.62 thousand. The disposal recorded on 02/09/2017 was priced at $37.52 per share. The stock price plunged -47.25 percent since the transaction. Heeter Jeffrey D. currently holds a stake of 31.4 thousand in AA stock which is worth $621.47 thousand after the insider selling.

The stock is lingering around the initial support level of $19.54. After this, the following support is at the zone of $19.28. Up until the time the AA stock hit levels beyond the current one, bulls should have no alarm. In terms of its momentum, the stock’s RSI hit 40.09 on the daily chart, and this may be a cause for concern. In case the price goes below $19.28 level on closing basis, there may be more profit booking with the stock growing weaker. Still, getting to the $20.03 level may cause a pull-back move approaching $20.26 mark.

Alcoa Corporation has a 20.4% gross profit margin, with its operating margin around 4.4%. Alongside this, the company’s net profit margin currently stands at -6.9%.