Fact based stock research
Alcoa (NYSE:AA)

US0138721065

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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Alcoa stock research in summary

alcoa.comglobalenhome.asp


ANALYSIS: With an Obermatt Combined Rank of 43 (worse than 57% compared with investment alternatives), Alcoa (Aluminum, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Alcoa are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives), and are riskily financed (Safety Rank of 31, which means above-average debt burdens) but show above-average growth (Growth Rank of 71). ...read more


RECOMMENDATION: A Combined Rank of 43, is a hold recommendation based on Alcoa's financial characteristics. As the company Alcoa shows low value with an Obermatt Value Rank of 49 (51% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 71% of comparable companies (Obermatt Growth Rank is 71). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 31 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Alcoa, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more


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Country USA
Industry Aluminum
Index Low Emissions, Energy Efficient, Diversity USA, Renewables Users, Water Efficiency
Size class XX-Large

21-Mar-2024. Stock data may be delayed. Log in or sign up to get the most recent research.




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Research History: Alcoa

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
SENTIMENT
SENTIMENT
360° VIEW
360° VIEW

Most recent update of the stock research: 21-Mar-2024. Financial reporting date used for calculating ranks: 30-Sep-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Alcoa is in the corresponding investment strategy.
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Combined financial peformance in Detail

ANALYSIS: With an Obermatt Combined Rank of 43 (worse than 57% compared with investment alternatives), Alcoa (Aluminum, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Alcoa are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives), and are riskily financed (Safety Rank of 31, which means above-average debt burdens) but show above-average growth (Growth Rank of 71). ...read more

RECOMMENDATION: A Combined Rank of 43, is a hold recommendation based on Alcoa's financial characteristics. As the company Alcoa shows low value with an Obermatt Value Rank of 49 (51% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 71% of comparable companies (Obermatt Growth Rank is 71). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 31 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Alcoa, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
COMBINED
COMBINED

Last update of combined financial performance: 21-Mar-2024. Stock analysis on combined financial performance: The higher the rank of Alcoa the better the performance.


Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 49 (worse than 51% compared with alternatives), Alcoa shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Alcoa. Price-to-Sales (P/S) is 87, which means that the stock price compared with what market professionals expect for future sales is lower than for 87% of comparable companies, indicating a good value concerning Alcoa's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 59, which means that dividends are expected to be higher than for 59% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 52% of alternatives (only 48% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 91% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a hold recommendation based on Alcoa's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more


VALUE METRICS 2021 2022 2023 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)
DIVIDEND YIELD
DIVIDEND YIELD
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE

Last update of Value Rank: 21-Mar-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Alcoa; except for dividend yield where the rank is higher, the higher the yield.


Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 71 (better than 71% compared with alternatives), Alcoa shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Alcoa. Sales Growth has a value of 56 which means that currently professionals expect the company to grow more than 56% of its competitors. Profit Growth with a value of 87 and Capital Growth with a rank of 77 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 15, which means that stock returns have recently been below 85% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 71, is a buy recommendation for growth and momentum investors. Alcoa has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Alcoa, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS 2021 2022 2023 2024
REVENUE GROWTH
REVENUE GROWTH
PROFIT GROWTH
PROFIT GROWTH
CAPITAL GROWTH
CAPITAL GROWTH
STOCK RETURNS
STOCK RETURNS
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH

Last update of Growth Rank: 21-Mar-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Alcoa.


Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 31 (better than 31% compared with alternatives), the company Alcoa has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Alcoa is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Alcoa and the other two below average. Refinancing is at 70, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 70% of its competitors. But Leverage is high with a rank of 45, meaning the company has an above-average debt-to-equity ratio. It has more debt than 55% of its competitors. Liquidity is also on the riskier side with a rank of 6, meaning the company generates less profit to service its debt than 94% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 31 (worse than 69% compared with alternatives), Alcoa has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Alcoa are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Alcoa and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS 2021 2022 2023 2024
LEVERAGE
LEVERAGE
REFINANCING
REFINANCING
LIQUIDITY
LIQUIDITY
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY

Last update of Safety Rank: 21-Mar-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Alcoa and the more cash is available to service its debt.


Sentiment Metrics in Detail

SENTIMENT 2021 2022 2023 2024
ANALYST OPINIONS
ANALYST OPINIONS
OPINIONS CHANGE
OPINIONS CHANGE
PRO HOLDINGS
PRO HOLDINGS
MARKET PULSE
MARKET PULSE
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT

Last update of Sentiment Rank: 21-Mar-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Alcoa.
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Stock analysis by the purely fact based Obermatt Method for Alcoa from March 21, 2024.

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