Tag Archives: Alcoa

Aluminum maker Alcoa battered by tough week

Alcoa Inc. Location Manager Ken McMillen, left, Sen. Lamar Alexander, Alcoa CEO Klaus Kleinfeld, U.S. Rep. John J. Duncan Jr., and Gov. Bill Haslam arrive for a groundbreaking for a $275 million expansion of the Alcoa Inc. rolling mill to produce automotive sheet aluminum on Thursday, Aug. 29, 2013, in Alcoa.  (Paul Efird/News Sentinel)

Alcoa Inc. Location Manager Ken McMillen, left, Sen. Lamar Alexander, Alcoa CEO Klaus Kleinfeld, U.S. Rep. John J. Duncan Jr., and Gov. Bill Haslam arrive for a groundbreaking for a $275 million expansion of the Alcoa Inc. rolling mill to produce automotive sheet aluminum on Thursday, Aug. 29, 2013, in Alcoa. (Paul Efird/News Sentinel)

The news hasn’t been good this week for aluminum manufacturer Alcoa Inc.
It’s stock price is tumbling, a Duetsche Bank analyst downgraded the stock to sell and forecasters were predicting aluminum prices would fall 12 percent or more over the next two years.
All this on the heels of Alcoa being booted last month from the Dow Jones Industrial Average.
The future of Alcoa, which recently announced plans for a $275 million expansion of its Blount County manufacturing operation, will have a significant impact on the East Tennessee economy. The company is investing in a plant upgrade in a move to take advantage of rising demand for aluminum by auto makers.
Alcoa will kickoff earnings season with the release of its quarterly financial report on Tuesday.
Given recent headlines it will be interesting to see how the company performed last quarter and its outlook for the near future.
Deutsche Bank analyst Jorge Beristain told Forbes the company should spin-off its primary metals business to ease its cash-flow problems.
Click the headlines below for more details:
CNNMoney: Alcoa CEO on debt ceiling
Motley Fool: Why Alcoa doesn’t seem so shiny
Forbes: Alcoa’s $1.2 Billion Drag: Analyst Makes Case For Breakup

Alcoa completes $600M Tapoco deal

 

Aluminum company Alcoa said Thursday it has completed the sale of its 378-megawatt Tapoco Hydroelectric Project to Brookfield Renewable Energy Partners.

Tapoco includes four hydroelectric power generating stations and dams on the Little Tennessee and Cheoah rivers in East Tennessee and western North Carolina.

The $600 million deal also includes 86 miles of transmission line and about 14,500 acres of land surrounding the hydroelectric project, Alcoa said in a news release.

 

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Pity the poor financial analysts — the economy is improving

Beating expectations has become the 1Q norm. The consenus among financial analysts was that corporate America had already squeezed as much profit as it could from a weak economy.

The analysts couldn’t have been more wrong. So far most companies have reported better than expected earnings. And by most, I mean about 8 out of 10.

It started with Alcoa, which reported a profit of $94 million, or 9 cents a share. Analysts were expecting a loss of 4 cents per share. On Tuesday, Apple surprised the experts with a profit of $11.6 billion, a whopping $12.30 a share. Analysts predicted $10.06 per share.

In between a slew of other companies have reported positive earnings.

If the experts could be so wrong about 1Q earnings, maybe the economy is doing better than they’re telling us. Or maybe this will be the highwater mark for 2012. I’m thinking the economy is slowly getting better and profits will be the norm this year.

Here’s a different view from Randall W. Forsyth writing for Barrons.com:

This May Be as Good as It Gets for Stocks in 2012

Here’s what the Fed said today:

Fed: Economy growing modertely; no policy changes

Big pay day for Alcoa exec despite pay cut

The second half of 2011 wasn’t kind to Alcoa Inc.’s stock price and Chairman and CEO Klaus Kleinfeld paid the price.

032610alcoa9_mc12884.JPGBecause his base pay is performance based, the aluminum company slashed Kleinfeld’s annual salary 45 percent to a relatively paltry $1.5 million when the stock slumped.

Don’t shed too many tears for Kleinfeld, though. His total compensation for the year was more than $14 million, Reuters reported. That includes salary, stock options, pension and other goodies.

I want that kind of job — take a 45 percent pay cut and still bank millions.

Reuters: Alcoa CEO’s awards cut on poor stock performance

Photo: Klaus Kleinfeld

Analysts look for clues in Alcoa cutback

Alcoa Inc.’s announcement that it would cut global smelting capacity 12 percent in response to falling aluminum prices is being sliced and diced today as analysts debate what to expect when Alcoa releases its quarterly earnings report on Monday.

Company shares were down more than 2 percent in late morning trading

Reuters quotes analyst Tony Rizzuto, of Dahlman Rose & Co., who sees the smelting reduction “as positive for Alcoa and the industry as it could lead to a more balanced supply/demand environment and provide some stability to aluminum pricing.”

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Ruby Tuesday expected to report loss

 

Ruby Tuesday

Ruby Tuesday

Restaurant chain Ruby Tuesday Inc. reports earnings today after the markets close. According to a Motley Fool report, analysts expect the Maryville-based company to report an increase in revenue, but a loss of about 6 cents per share.

ALCOA

ALCOA

Aluminum company Alcoa Inc., which has a major manufacturing plant in Blount County, reports Monday. Analysts expectations are mixed. Alcoa is traditionally the first of the major companies to release its quarterly report.

 

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Not all market news is scary — Alcoa, S&P 500 profits rising

Concern about the global economy has Wall Street tumbling today, but not all the market news is quite so scary. Consider the profit expectations for aluminum maker Alcoa Inc.

Bloomberg says Alcoa, which has a large presence next door in Blount County, may report that its second quarter profit more than doubled on rising global demand. Alcoa is benefiting from the growth of companies like General Motors and Airbus.

But wait, there’s more.

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My merit badge is missing

In case you missed it, here’s a link to my column in the business section of Sunday’s Knoxville News Sentinel.

In a nutshell, the column asserts that the economy remains painfully slow, but it is creating jobs and isn’t as bad as some on the far right suggest.

Not all readers shared my point of view, but thanks to all who took the time to post a comment.

Some readers posted a few questions that I will attempt to answer.

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Working together to benefit taxpayers

In a rare display of cooperation and good sense, five small counties in northwest Tennessee and southwest Kentucky have formed an alliance to work on economic development.

The Ken-Tenn Regional Alliance, which represents Obion, Weakley and Lake counties in Tennessee and Fulton and Hickman counties in Kentucky, operates at the other end of the state, but East Tennessee economic develoment officials would do well to pay close attention to the group’s efforts.

Working across county and state lines presents certain political hurdles, but joint ventures can serve taxpayers well if local officials are sincere in their efforts to cooperate.

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Alcoa’s dam offensive turns on ‘charm’

Fortune takes an interesting look at Alcoa Inc.’s battle with North Carolina to keep control of four hydroelectric dams on the Yadkin River.

Fortune reports that the aluminum giant has “turned on the charm offensive with state and local officials.”

Never thought I would see Alcoa called charming.

Read the complete story here: Alcoa’s new tactic in dam dispute: Charm