Per market tradition, Alcoa’s (AA) earnings beat yesterday is being treated like a victory for the stock market. But the earnings didn’t reflect particularly well on Alcoa.
The aluminum-maker’s second-quarter earnings and revenue topped analyst expectations. But that doesn’t mask the fact that the blue-chip company still suffered a quarterly loss.
The company reported a net loss of $2 million, or 0 cents per share – down from a net income of $322 million, or 28 cents a share, a year ago. Revenue was also down 10% from a year ago.
The sluggish global economy was largely responsible for Alcoa’s lackluster quarter. Aluminum is the second-most used metal in the U.S. behind steel, and is used in everything from cars to construction materials to beer cans. That’s why Alcoa has long been considered a bellwether stock for the broad market, and is the unofficial kickoff to earnings season.
So despite reporting earnings that were well off last year’s pace, Alcoa still managed to inject some life into the market by beating analyst expectations. Excluding items, the company’s earnings of 6 cents per share were a penny more than what most analysts were forecasting.
In a market desperate for good news, Alcoa’s earnings beat was enough to push the S&P 500 up 0.2% this morning.
The earnings didn’t do much for Alcoa’s stock, however: Shares have tumbled 2.4% since yesterday’s late-afternoon earnings announcement, pushing the stock close to its 52-week low.
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