Alcoa Expected to Fall Short in 2Q13, Says Citi and Goldman
NEW YORK (TheStreet) - With second-quarter reports to be released after market closing Monday, analysts expect lower than estimated earnings for Alcoa
The aluminum producer's shares rose 1% in midday trading Monday to $7.89, closing in on Goldman Sach's 6-month price target of $8.
Analysts from multiple firms have lowered their expectations for the company as the price of aluminum settled at $0.84 per pound. "We are shaving our 2Q estimate to $0.07
In its first-quarter, Alcoa reported an after tax income of $351 million. However, Citi bank expects operating income for the company to fall as low as $304 million this quarter. Citi sees revenue from engineered products dropping 10% to $169 million, and losing 2% of income from rolled products or $95 million in the third quarter. "
Despite retaining a "neutral" rating, Goldman Sachs analysts warranted cautioun. "
With second-quarter earnings approaching, investors are expected to focus on the balance sheet and cash burn. Investors will be interested in other matters such as equity issuance, portfolio structuring, market outlook and new projects aimed at producing growth. Such products could include aluminum-lithium and auto aluminum rolling.
-- Written by Robert Arenella in New York
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