Alcoa Stock is Outpacing the Markets: Will That Continue?

AA peaked at nearly $100 earlier this year

May 17, 2022 at 12:17 PM
facebook twitter linkedin

Aluminum stock Alcoa Corporation (NYSE:AA) has long been a favorite in this space in the last 12 months. As the tech sector crumbles, value stocks like AA have become quite attractive. Up 55% year-over-year, is that still the case as we approach the six-month mark of 2022?

On the dividend front, Alcoa recently declared a quarterly cash dividend of $0.10 per share, to be paid on June 3 to stockholders of record as of the close of business on May 17. With this, the metals company offers a dividend yield of 0.69% and a forward dividend of $0.40.

Alcoa stock was last seen up 4.2% to trade at $62.77, putting some distance from its year-to-date breakeven level. After AA climbed above $100 in late March, the shares have shed 30% this quarter. The good news; the damage for now has been contained by the $55 level, which happens to coincide with the 260-day moving average. 

Moreover, the metals business’ fundamentals provide uncertainty for long-term investors. As recent as fiscal 2019, AA reported $1.125 billion in net losses and a 22.2% decrease in annual revenues. In addition, Alcoa is expected to see a decline on their top- and bottom-line figures for fiscal 2023. Estimates have AA's earnings decreasing by 12% and their revenues by 1.3%.

Alcoa stock continues to offer an attractive valuation at a forward price-earnings ratio of 4.62 and a price-sales ratio of 0.82. AA is also estimated to end fiscal 2022 with 70.1% earnings growth and 18% revenue growth, making Alcoa stock an option for short-term traders.


Stop leaving money on the table with the same old broken options trading approach...

There is no options strategy that more perfectly capitalizes during earnings season better than this simple call and put buying strategy. Perfect for aggressive traders looking to recover their suffering portfolios so far in 2022. With the simplest possible options strategy, Schaeffer's team with 100+ years of options trading excellence, target 200% gains on every single trade. So many trades are being beaten down by the market, but don't be one of them! Don't waste another second... join us right now before the next trade is released! 

Schaeffer's Daily Bulletin Offer


Special Offers from Schaeffer's Trading Partners