Alcoa (AA) announced earnings of $0.06 per share for the second quarter, beating expectations of $0.05 per share. The aluminum company’s net revenue fell 9.4% to $5.96 billion due to aluminum prices dropping 18% compare to this time last year.
Additionally, the company’s management reaffirmed the global demand for aluminum growth projection of 7%. They announced that the China market was growing well, but that the U.S. market was slowing down. Their CEO Klaus Klausfeld said in the announcement, “Although aluminum prices are down, the fundamentals of the aluminum market remain sound with strong demand and tight supply, and Alcoa is successfully capitalizing on accelerating demand in high-growth end markets such as aerospace and automotive.”
Alcoa unofficially kicked off the second quarter earnings season after a difficult quarter for markets worldwide. The S&P 500 lost almost 1% by the end of the quarter, with its lowest point dropping to $1,278.04, which was 7% down from the beginning of March. The index is currently above $1,350.
Since the market for aluminum continues to grow, the prices will eventually rise to match the growing demand. China continues to be a massive consumer for aluminum, as well as many other commodities. It would not be surprising to see Alcoa take advantage of the market and grow their revenues for the foreseeable growth of the industry.
Business Section: Investing Ideas
Earnings season has officially begun, and analysts are eager to see which names bring positive “earning surprises.”
If you’re on the hunt, we list below other companies announcing earnings this week that have a strong history of beating earning expectation. Do you think they will do as well or better than Alcoa?
List sorted by market cap.
1. Wolverine World Wide Inc. (WWW, Earnings, Analysts, Financials): Engages in manufacturing, sourcing, marketing, licensing, and distributing footwear, apparel, and accessories to the retail sector primarily in the United States, Europe, and Canada. Market cap at $1.87B, most recent closing price at $38.33. In Jun 2011: Reported EPS at 0.48 vs. estimate at 0.46 (surprise of 4.3%). In Sep 2011: Reported EPS at 0.82 vs. estimate at 0.75 (surprise of 9.3%). In Dec 2011: Reported EPS at 0.47 vs. estimate at 0.45 (surprise of 4.4%). In Mar 2012: Reported 0.64 vs. estimate at 0.55 (surprise of 16.4%. [Average earnings surprise at 8.6%]. Earnings to be announced on 07/10.
2. Bank of the Ozarks, Inc. (OZRK, Earnings, Analysts, Financials): Operates as the bank holding company for Bank of the Ozarks that provides a range of retail and commercial banking services. Market cap at $1.03B, most recent closing price at $29.91. In Jun 2011: Reported EPS at 1.46 vs. estimate at 0.39 (surprise of 274.4%). In Sep 2011: Reported EPS at 0.55 vs. estimate at 0.42 (surprise of 31%). In Dec 2011: Reported EPS at 0.51 vs. estimate at 0.49 (surprise of 4.1%). In Mar 2012: Reported 0.52 vs. estimate at 0.51 (surprise of 2%. [Average earnings surprise at 77.88%]. Earnings to be announced on 07/12.
3. iGATE Corporation (IGTE, Earnings, Analysts, Financials): Provides outsourced information technology (IT) and IT-enabled operations, solutions, and services. Market cap at $969.49M, most recent closing price at $16.95. In Jun 2011: Reported EPS at 0.16 vs. estimate at 0.13 (surprise of 23.1%). In Sep 2011: Reported EPS at 0.26 vs. estimate at 0.21 (surprise of 23.8%). In Dec 2011: Reported EPS at 0.27 vs. estimate at 0.26 (surprise of 3.8%). In Mar 2012: Reported 0.38 vs. estimate at 0.32 (surprise of 18.8%. [Average earnings surprise at 17.38%]. Earnings to be announced on 07/13.
4. Trinity Biotech plc (TRIB, Earnings, Analysts, Financials): Develops, manufactures, distributes, and sells diagnostic test kits and instrumentation worldwide. Market cap at $256.3M, most recent closing price at $12.08. In Jun 2011: Reported EPS at 0.17 vs. estimate at 0.16 (surprise of 6.3%). In Sep 2011: Reported EPS at 0.18 vs. estimate at 0.16 (surprise of 12.5%). In Dec 2011: Reported EPS at 0.18 vs. estimate at 0.17 (surprise of 5.9%). In Mar 2012: Reported 0.19 vs. estimate at 0.17 (surprise of 11.8%. [Average earnings surprise at 9.12%]. Earnings to be announced on 07/12.
5. Material Sciences Corp. (MASC, Earnings, Analysts, Financials): Engages in the design, manufacture, and marketing of material-based solutions for acoustical and coated applications in the United States and internationally. Market cap at $94.33M, most recent closing price at $9.02. In May 2011: Reported EPS at 0.33 vs. estimate at 0.13 (surprise of 153.8%). In Aug 2011: Reported EPS at 0.29 vs. estimate at 0.24 (surprise of 20.8%). In Nov 2011: Reported EPS at 0.34 vs. estimate at 0.23 (surprise of 47.8%). In Feb 2012: Reported 0.19 vs. estimate at 0.12 (surprise of 58.3%. [Average earnings surprise at 70.18%]. Earnings to be announced on 07/11.
6. Intervest Bancshares Corp. (IBCA, Earnings, Analysts, Financials): Operates as the holding company for Intervest National Bank and Intervest Mortgage Corporation, which engage in banking and real estate lending businesses. Market cap at $79.88M, most recent closing price at $3.70. In Jun 2011: Reported EPS at 0.12 vs. estimate at 0.06 (surprise of 100%). In Sep 2011: Reported EPS at 0.12 vs. estimate at 0.09 (surprise of 33.3%). In Dec 2011: Reported EPS at 0.13 vs. estimate at 0.11 (surprise of 18.2%). In Mar 2012: Reported 0.13 vs. estimate at 0.12 (surprise of 8.3%. [Average earnings surprise at 39.95%]. Earnings to be announced on 07/09.
Written by Danny Guttridge
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Analyze These Ideas: Getting Started
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Dig Deeper: Access Company Snapshots, Charts, Filings
- Wolverine World Wide Inc. (WWW, Chart, Download SEC Filings)
- Bank of the Ozarks, Inc. (OZRK, Chart, Download SEC Filings)
- iGATE Corporation (IGTE, Chart, Download SEC Filings)
- Trinity Biotech plc (TRIB, Chart, Download SEC Filings)
- Material Sciences Corp. (MASC, Chart, Download SEC Filings)
- Intervest Bancshares Corp. (IBCA, Chart, Download SEC Filings)
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