NEW YORK, NY--(Marketwire - Feb 26, 2013) - Aluminum industry is going through demand and supply imbalance, where supply surpassed demand, leading to price glut. The impact of the situation is clearly visible on the bottom-line of the leading companies. Noranda Aluminum Holding Corp. (
Access our free reports on Alcoa Inc. and Noranda Aluminum Holding Corp. Traders can also connect to our Wall Street Trading Floor where our research desk and market pros are standing between 8:50 am to 4:15 pm ET at
Noranda Aluminum reported its fourth quarter results and beat revenue expectations. Its revenue stood at $332.9 million, surpassing analysts' estimates of $332.09 million, while the company's EPS was recorded at -$0.12, lagging behind consensus estimate of -$0.03. Noranda's stock is down 20 percent as far as this year is concerned. However, it is expected to pick up on the back of better-than-expected results.
The company is also restructuring its business to curtail costs. Its results suffered due to price squeeze for its products. However, demand is expected to pick up this year and may compensate for the slump in selling price. The company is also looking for alternative sources of financing to cut down its costs. Noranda is also able to put all its upstream plants in full production. While the weakness in aluminum is likely to persist, the company may pull back its profits with proper cost-cutting measures.
Despite the company stock's disappointing performance, Noranda delivers 3.30 percent dividend yield. It recently announced its quarterly dividend of 4 cents per share. The company's dividend payment is deemed to be safe and its stock is also likely to recover in the midterm period.
Alcoa Inc. is one of the leading companies in its segment. However, it is also grappling with weakness in the broader market. It has a global presence and thus is more insulated to regional turbulences. Alcoa also deals in non-aluminum products and blunting the sting of soft aluminum prices. The company still derives three quarter of its revenue from alumina and related metals.
The company's stock is down 3 percent thus far in 2013. However, it recently reported strong results, which may act as a positive catalyst for the stock. The company also announced its quarterly dividend at 3 cents per share, providing value to its investors. For its fourth quarter, the company reported its net income at $242 million, up from net loss of $191 million it had incurred for the previous year quarter.
The company is also aggressively pursuing growth as it signed a new deal with Commercial Aircraft of China Ltd. through its Alcoa Fastening Systems unit. The deal will help the company in boosting its presence in China. Under this agreement Commercial Aircraft of China will buy its supplies from Alcoa. The company also inked a new JV with Australian firm Alumina. The JV is named Alcoa World Aluminum & Chemicals.
Shine's Rooms is the brain child of David Shine, a 13 year Wall Street veteran with a stellar track record. For 13 years Shine has trained thousands of traders to navigate and profit from the markets. Using cutting edge technology, Shine provides you with a community in which you can trade alongside Shine and his Team as they guide you through the market's ever-changing landscape. ShinesRooms.com is the Ultimate Trading Environment for investors. Over the last 5 years our returns outpaced any of the major indexes. Sign up today to find out what you are missing. www.ShinesRooms.com
To view our disclaimer, visit this link http://www.shinesrooms.com/disclaimer.html.
- Investment & Company Information
Michael Thomas Smith