Alcoa Inc (NYSE:AA) stock prices closed up $12.53 per share, and further gained by 2.31% during the extended hours trading, which led the stock price to rise to the level of $12.82 per share. This rise was a result of the robust Q1 earnings of the company that were higher than what Wall Street analysts estimated.
Alcoa Inc (NYSE:AA)’s chairman and executive officer, Klaus Kleinfeld, said, “We hit record downstream profitability, nearly tripled results in the midstream, and strengthened our upstream business for the 10th quarter in a row.”
Alcoa easily beating estimates
For Jan-Mar quarter, the Street had estimated an adjusted EPS of $0.05 and that the company has been successful in beating this estimate by large. The adjusted earnings of Alcoa Inc (NYSE:AA) were $98 million or $0.09 per share.
Including one-time items, the net loss for the company was $178 million i.e. $0.16 per share. This special item of $276 million was related to the smelting and rolling mill capacity reductions of the company. The company’s revenue came in at $5.5 billion, which is a sequentially decline of 2%, and is primarily due to the lower third party shipments of Primary Metals.
“Our transformation is accelerating – we’re powering growth in our value-add businesses and aggressively reshaping our commodity business,” said Kleinfeld.
Outlook for 2014
Moving ahead with 2014, Alcoa Inc (NYSE:AA) expects that there will be an increase in the demand for steel. The demand for commercial aircraft and business jets, that make use of huge quantities of aluminum in the construction of their bodies, is going up. Same is the case with the automotive, construction and packing industries. Alcoa is expecting that the demand for aluminum globally will grow by 7%, in 2014. Alcoa is fabricating some special metals that are expensive, but would have a considerable demand in coming future.
Although the aluminum prices are falling drastically the stock price for the company is up by 54%. The good to know fact is that car manufacturing companies are increasingly using Aluminum in the bodies of the cars instead of steel.