Century Aluminum Company’s CENX fully-owned subsidiary — Century Aluminum Sebree LLC — announced two new expansion programs at the Sebree smelter. The move will boost the smelter’s production of value-added and secondary aluminum.
The expansions are expected to be complete in the first quarter of 2019. It will improve the smelter’s product mix by adding around 90,000 MT of additional billet to the Sebree casthouse. This will boost the smelter’s overall output by adding 20,000 MT of additional secondary or scrap reprocessing capacity. The company expects Sebree to produce roughly 230,000 MT of aluminum (primary and secondary) products in 2019. This includes around 175,000 MT of billet.
The expansion programs indicate the company’s confidence in the future of the U.S. aluminum industry along with the consistent positive impacts of the Trump administration’s Section 232 program.
Shares of Century Aluminum have lost 45.6% in the past six months compared with the industry’s 22.5% decline.
In October, Century Aluminum stated that downstream demand depicts growth and the trend is likely to continue moving ahead. Primary aluminum inventories across the globe have declined as projections indicate a production deficit of roughly 2 million metric tons in 2018, per the company. Delivery and product premiums are firm in the United States, supported partly by the business-friendly policies taken by the U.S. administration.
The company believes that it is now witnessing the end-phase of the difficult conditions that have impacted the alumina sector during 2018. It expects the alumina market to be well supplied and prices to return to historical norms, considering the resolution of these issues.
Century Aluminum Company Price and Consensus
Century Aluminum Company Price and Consensus | Century Aluminum Company Quote
Zacks Rank & Key Picks
Century Aluminum currently carries a Zacks Rank #4 (Sell).
A few better-ranked stocks in the same sector include Enersys ENS, sporting a Zacks Rank #1 (Strong Buy) as well as Rexnord Corporation RXN and Applied Industrial Technologies, Inc. AIT carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Enersys has a long-term earnings growth rate of 10%. The company’s shares have gained 24.1% in the past year.
Rexnord has a long-term earnings growth rate of 16.4%. The stock has gained 13.5% in a year’s time.
Applied Industrial Technologies has a long-term earnings growth rate of 11.5%. Its shares have increased 3% in the past year.
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