Earnings Preview: Alcoa shares near 52-week low ahead of Q1 report

Alcoa (AA) is scheduled to report Q1 earnings after the close on Monday, April 8, with a conference call scheduled for 5:00 pm ET. Alcoa is a global manufacturer of aluminum products. EXPECTATIONS: Analysts are looking for EPS of 10c on revenue of $5.93B, according to First Call. The consensus range for EPS is 4c-16c on revenue of $5.59B-$6.2B. LAST QUARTER: Alcoa reported Q4 adjusted EPS of 6c against estimates for 6c on revenue of $5.9B against estimates for $5.6B. On its Q4 earnings report, the company forecast 2013 aluminum demand growth of 7%, up from 6% in 2012, and ahead of the 6.5% rate required to meet its forecast of a doubling in global aluminum demand between 2010 and 2020. CEO Klaus Kleinfeld said, "Alcoa hit record profitability in our mid and downstream businesses, and continued to drive efficiency in our upstream businesses in the fourth quarter, all while cutting debt and maintaining our cash position. We enter 2013 in a strong position to maximize profitable growth." He noted the company’s "overarching goal" was to generate free cash flow in 2013. STREET RESEARCH: Sentiment on the Street has been cautious in the weeks leading up to Alcoa's Q1 earnings report. On January 10, Macquarie downgraded Alcoa to Underperform from Neutral citing lower aluminum price forecasts and valuation. The firm lowered its price target to $6 from $9. On March 8, Stifel Nicolaus said Alcoa’s valuation was attractive and maintained a Buy rating on the shares. Stifel cited growing demand for aluminum from automakers as a tailwind for the company. On April 4, BofA/Merrill forecast a possible credit downgrade for Alcoa after the company posts Q1 earnings, citing deteriorating quarter-over-quarter credit metrics. BofA said Moody’s could downgrade it to junk status and the firm lowered its target price on the shares to $9 from $10. PRICE ACTION: Alcoa shares have fallen approximately 12% following the company's Q4 report, and are currently approaching a 52-week low of $7.96. In late morning trading ahead of Monday's Q1 report, Alcoa shares are flat.