Alcoa Corporation (AA) Appears To Be In Wait-and-See Mode

If you can handle volatility, Alcoa Corporation (NYSE:AA) is the stock to watch now. The stock closed lower on 06 December. The shares dropped -0.75 points or -2.47 percent at $29.65 with a heavy trade volume of 4.242 million shares. After opening the session at $29.66, the shares went as high as $29.68 and as low as $28.12, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $5.51 billion and now has 186 million shares outstanding. Alcoa Corporation (AA) stock has lost -18.99 percent of market value in 21 trading days.

AA stock has a trailing 3-year beta of 0, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $0.03 a share in the trailing twelve months. The stock’s value has fallen -44.96 percent year to date (YTD) against a decline of -28 percent in 12 month’s time. The company’s shares still trade -52.45 percent away from its 1-year high of $62.35 and -2.05 percent down from 52-week low of $30.27. The average consensus rating on the company is 2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Alcoa Corporation (AA) will probably climb 91.26 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $75-month high price target. This represents a whopping 152.95 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $52.5, which represents a return potential of 77.07 percent when compared to the closing price of the stock of $29.65 on Thursday, December 06. The lowest price target for the stock is $31 — slightly more than 4.55 percent from AA’s current share price.

History has shown that shares in Alcoa Corporation have gone down on 21 different earnings reaction days and are predicted to add 0.03 percent when the company reports upcoming earnings.

Let’s take a look at some insider activity at Alcoa Corporation (NYSE:AA) and see the pattern. The earliest insider trade took place on 01/31/2018. Sigurdsson Tomas Mar parted with a total of 10 thousand shares of company at average share price of $51.37. The total for the sales was set at $513.7 thousand. After this transaction, the Exec VP and COO account balance stood at 46.83 thousand shares. The stock lost -40.82 percent since that insider sale. On 01/22/2018, Oplinger William F, Executive VP & CFO, sold 229.48 thousand shares at a price per share of $52.86. This removed 12.13 million shares from the insider’s fortune and the stock saw a -42.49 percent retreat in value since the news became public. This transaction left 102.63 thousand shares in the Executive VP & CFO account.

On 02/14/2017, Former 10% owner Arconic Inc. performed a sale transaction worth $888.11 million. This sale at $38.03 each has eliminated 23.35 million shares from the insider’s portfolio position. Meanwhile, shares have recorded -20.06 percent decrease since the transaction was reported. The insider now is left with 12.96 million shares remaining in the account. Heeter Jeffrey D., who performs the EVP, Gen. Counsel & Secretary job, sold 3.75 thousand shares for $140.62 thousand. The disposal occurred on 02/09/2017 was priced at $37.52 per share. The share price plunged -18.98 percent since the reporting date. Heeter Jeffrey D. now left with a stake of 31.4 thousand AA stock worth $931.1 thousand after the insider selling.

The stock is currently hovering around the first support level of $28.62. Below this, the next support is placed in the zone of $27.59. Till the time, the AA stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 34.6 on daily chart, which may remain a cause for comfort. If the price breaks below $27.59 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $30.18 mark may result into a pull-back move towards $30.71 level.

Further, it is sporting a 0.42 on the Price-to-Sales ratio. Compare this with the industry average P/S of 99.94. 25.1 percent is the gross profit margin for Alcoa Corporation and operating margin sits at 12.1 percent. Along with this, the net profit margin is -0.1 percent.