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Will Alumina and Bauxite Benefit Alcoa's (AA) Q1 Earnings?

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Alcoa Corporation AA is set to release first-quarter 2022 results on Apr 20, after market close.

The company’s Bauxite segment is engaged in bauxite mining operations and processes bauxite into alumina with the help of the bayer process to sell it to customers.

The company’s Alumina segment comprises its refining system, which is used for processing bauxite into alumina.

Key Factors to Note

In the past few quarters, the Bauxite segment’s performance has been strengthening Alcoa’s revenues. It has been gaining primarily from the increased demand for bauxite from its own refineries and third-party customers. Also, its focus on improving operational efficiency supported by its pricing actions is anticipated to have aided the segment in the to-be-reported quarter. However, lower shipment volume for bauxite and supply-chain challenges might have affected its performance.

For the first quarter of 2022, the Zacks Consensus Estimate for Bauxite segment’s revenues is pegged at $234 million, suggesting a 3.7% decline from the year-ago quarter’s reported number and a 9.3% fall from the previous quarter’s figure.

The company’s project for high purity alumina production and its efforts to offer new products, cost-saving actions and solid orders are likely to have aided Alumina segment’s performance in the first quarter. Growing popularity for the company’s Sustana and EcoSource line of products, supported by higher prices, is likely to have boosted its performance in the quarter. However, higher raw materials and energy costs might have affected its margins.

For the first quarter of 2022, the Zacks Consensus Estimate Alumina segment’s revenues is pegged at $1,307 million, suggesting growth of 16.3% from the year-ago quarter’s reported number but a 10.8% decrease from the previous quarter’s figure. (Read more: Alcoa to Report Q1 Earnings: What’s in the Offing?)

Alcoa Price and EPS Surprise

Alcoa Price and EPS Surprise
Alcoa Price and EPS Surprise

Alcoa price-eps-surprise | Alcoa Quote

Zacks Rank & Other Upcoming Releases

Alcoa currently sports a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.

Some companies in the Zacks Industrial Products sector, which are also slated to report their results soon, are ABB Ltd ABB, Roper Technologies, Inc. ROP and A. O. Smith Corporation AOS. ABB will release results on Apr 21, Roper on Apr 26 and A. O. Smith on Apr 28.

The Zacks Consensus Estimate for ABB’s earnings is pegged at 34 cents per share for the to-be-reported quarter. The Zacks Rank #3 (Hold) company’s shares have lost 15.8% in the past three months.

The Zacks Consensus Estimate for Roper’s earnings is pegged at $3.69 per share for the to-be-reported quarter. The Zacks Rank #2 (Buy) company’s shares have gained 3.5% in the past three months.

The Zacks Consensus Estimate for A. O. Smith’s earnings is pegged at 76 cents per share for the to-be-reported quarter. The Zacks Rank #3 stock’s shares have lost 21% in the past three months.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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