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Stock Spotlight Designer 05/28/2024
Audience: Advanced Investor
About Alcoa Corporation (AA)
Alcoa Corporation and its subsidiaries produce and sell bauxite, alumina, and aluminum products in the United States, Spain, Australia, Iceland, Norway, Brazil, Canada, and internationally. The company operates through two segments: Alumina and Aluminum. It engages in bauxite mining operation, processes bauxite into alumina, and sells it to customers who process it into industrial chemical products, as well as aluminum smelting and casting businesses.
The company offers primary aluminum in the form of alloy ingot or value-add ingot to customers that produce products for the transportation, building and construction, packaging, wire, and other industrial markets. Alcoa also owns hydro power plants that generate and sell electricity in the wholesale market to traders, large industrial consumers, distribution companies, and other generation companies. Founded in 1886 and headquartered in Pittsburgh, Pennsylvania, Alcoa has a rich history of innovation and industry leadership.
Below are key metrics for Alcoa Corporation:
- Sector: Materials
- Industry: Metals & Mining
- Market Capitalization: 7.477 billion USD
- EBITDA: 564 million USD
- Dividend Yield: 0.96%
- Revenue (TTM): 10.48 billion USD
- 52-Week High: 44.57 USD
- 52-Week Low: 22.83 USD
- Beta: 2.45
Risk
Investing in Alcoa Corporation (AA) comes with a high level of risk. Over the past year, AA has exhibited a high annualized standard deviation of 50.75%, significantly higher than the S&P 400 Midcap benchmark's 15.73%. This indicates a higher volatility and potential for price swings compared to its benchmark.
The Sharpe Ratio for AA over the past year stands at -0.02, which is notably lower than the benchmark's 1.08. This negative Sharpe Ratio suggests that the stock has underperformed on a risk-adjusted basis. Additionally, the maximum drawdown for AA over the past year was -36.53%, compared to -15% for the benchmark, highlighting the stock's potential for significant losses.
Value at Risk (VaR) with a 99% confidence level estimates that the maximum loss in a single day will not surpass -9.09%, compared to -3.13% for the benchmark. This metric underscores the potential for substantial daily losses. On the upside, the potential gain in a single day is estimated at 9.55%, which is higher than the benchmark's 2.86%, indicating some potential for significant gains as well.
News Sentiment Analysis
The sentiment analysis of historical news articles for Alcoa Corporation (AA) reveals varying degrees of sentiment over different time frames. The scoring system ranges from -1 for negative sentiment to +1 for positive sentiment.
There were no articles analyzed in the last week from May 21, 2024, to May 28, 2024. Over the last four weeks from April 30, 2024, to May 28, 2024, nine articles were analyzed with an average sentiment score of +0.82, suggesting a generally positive sentiment towards AA during this period. Gaps in sentiment data indicate news stories that were not analyzed by our data provider.
