In a research report published this morning, Sterne Agee reiterated its ‘Buy’ rating on Alcoa (AA) after the aluminum producer on Tuesday evening reported quarterly profit and revenue that beat the Street’s expectations.
Alcoa posted a profit of $138 million, or 12 cents per share, in the second quarter, compared to a loss of $119 million, or 11 cents a share, in the year-ago period. Revenue was flat at $5.84 billion but even that came in much better than the $5.51 billion expected. Adjusted to exclude one-time items, earnings were $216 million, or 18 cents a share from 7 cents a share. Analysts were looking for adjusted earnings of 12 cents a share on revenue of $5.66 billion.
Alcoa said that all its business segments were profitable during the three months ended June.
“Alcoa continues to improve, and we would continue to be buyers,” Sterne Agee [via Bizjournals] said in its note to investors. The research firm currently has a $18 price target on the shares, up from their previous price target of $15.
“Alcoa is executing on the fundamental themes which we believe provide support for our near-term $18 price target,” Sterne Agee said. “The pace of activity across the board for aerospace, automotive and cost containment is picking up.”
Trading currently 4.24% higher at $15.49, Alcoa is worth $18.19 billion in market cap. AA has had an excellent fiscal 2014 overall so far: ticker is up nearly 44% year-to-date, and up a more than 92% in the last 52 weeks.