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Amid Headwinds, Alcoa Is Worth a Look

As investors focus on short-term issues, we think the stock is trading at an attractive entry point, even after trimming our fair value estimate.


 Alcoa (AA) reported unimpressive second-quarter results, as the benefits of the company's well-publicized portfolio transformation weren't enough to offset the negative impact of materially lower all-in aluminum prices.

Although we had long expected aluminum premiums to decline, we were surprised that aluminum LME spot prices also moved lower during the quarter. As a result, Alcoa's realized price per metric ton of aluminum declined to $2,180, a 10% sequential decline.

Andrew Lane does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.