Carol Cowan, Moody’s Investors Service analyst, wrote: Alcoa’s 2nd quarter performance was in line with Moody’s expectations and demonstrate that the company’s efforts to transform itself to a lightweight metals value added company continues to gain traction despite headwinds. Additionally, progress in rationalizing its primary metals segment and achieving lower production costs and similar improvements in its alumina segment resulted in these 2 segments continuing to report positive ATOI (after tax operating profit) despite lower LME aluminum prices, the collapse in regional premiums and a lower API (alumina price index). Additionally Alcoa continues to maintain a solid liquidity position. These trends are expected to continue and support the recent change in rating outlook to positive.
Current short interest at 72.47 million shrs, up 23% since last month. 9% of float -- and growing. Any positive trigger could uncoil it. The risk/reward shifting rapidly to the upside as the lemmings start to crowd the short trade. If long, I say, stay long. If not, time to start adding and going long.