CHICAGO, April 9, 2012 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Alcoa Inc. (NYSE: AA), Aluminum Corporation of China Limited (NYSE: ACH), Rio Tinto plc. (NYSE: RIO), BHP Billiton Ltd. (NYSE: BHP) and AutoNation Inc. (NYSE: AN).
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Here are highlights from Thursday's Analyst Blog:
Earnings Preview: Alcoa
Alcoa Inc. (NYSE: AA) is scheduled to report its first-quarter 2012 results after the market closes on Tuesday, April 10. The Zacks Consensus Estimate for the quarter is a loss of 4 cents per share, representing a significant year over year decrease of 112.5%.
With respect to earnings surprises, the company missed the Zacks Consensus Estimate in three of the trailing four quarters while exceeding in one of the quarters. This is reflected in the average earnings surprise of -109.64%.
Fourth-Quarter and Full Year 2011 Synopsis
Excluding restructuring charge of $159 million and other items, Alcoa's loss came in at 3 cents per share in the fourth quarter of 2011, below the Zacks Consensus Estimate of a profit of 1 cent. It is the company's first loss in the last nine quarters. The disappointing results were driven by higher costs of energy and transportation. For full-year 2011, Alcoa reported income from continuing operations of $614 million, or 55 cents per share, more than double of 2010 results.
Despite a 6% year over year rise in revenues to $6 billion, business was down in most industries including construction, industrial products, packaging and commercial transportation. For 2011, revenues increased 19% to $25 billion from $21 billion in 2010.
Company's Outlook
For 2012, Alcoa expects global aluminum demand to grow 7% due to global deficit in primary aluminum supply. The company expects global aluminum demand to double by 2020 compared with 2010.
Agreement of Estimate Revisions
In the past 30 days, two analysts made downward revisions while one analyst made upward revision for the first quarter of 2012. In the last seven days, none of the analysts made any downward revision but only one analyst made an upward revision of estimate.
Magnitude of Estimate Revisions
In the last 30 days, the Zacks Consensus Estimate for the quarter has decreased to a loss of 4 cents per share from a loss of 3 cents prior to that. Over the last 90 days, the Zacks Consensus Estimate for the quarter plunged to a loss of 4 cents per share from a profit of 13 cents prior to that.
Our Viewpoint
We believe that the company's outlook depends on the uncertainties in the aluminum market. We are concerned about volatile prices of aluminum and rising raw material costs.
Alcoa also faces stiff competition from Aluminum Corporation of China Limited (ACH), Rio Tinto plc. (RIO) and BHP Billiton Ltd. (BHP). In view of the above stated reasons, the company retains a Zacks #3 Rank, indicating a short-term (1 to 3 months) "Hold" rating and we have a long-term (more than 6 months) "Neutral" recommendation on the stock.
Alcoa Inc. (AA) is scheduled to report its first-quarter 2012 results after the market closes on Tuesday, April 10. The Zacks Consensus Estimate for the quarter is a loss of 4 cents per share, representing a significant year over year decrease of 112.5%.
With respect to earnings surprises, the company missed the Zacks Consensus Estimate in three of the trailing four quarters while exceeding in one of the quarters. This is reflected in the average earnings surprise of -109.64%.
Fourth-Quarter and Full Year 2011 Synopsis
Excluding restructuring charge of $159 million and other items, Alcoa's loss came in at 3 cents per share in the fourth quarter of 2011, below the Zacks Consensus Estimate of a profit of 1 cent. It is the company's first loss in the last nine quarters. The disappointing results were driven by higher costs of energy and transportation. For full-year 2011, Alcoa reported income from continuing operations of $614 million, or 55 cents per share, more than double of 2010 results.
Despite a 6% year over year rise in revenues to $6 billion, business was down in most industries including construction, industrial products, packaging and commercial transportation. For 2011, revenues increased 19% to $25 billion from $21 billion in 2010.
Company's Outlook
For 2012, Alcoa expects global aluminum demand to grow 7% due to global deficit in primary aluminum supply. The company expects global aluminum demand to double by 2020 compared with 2010.
Agreement of Estimate Revisions
In the past 30 days, two analysts made downward revisions while one analyst made upward revision for the first quarter of 2012. In the last seven days, none of the analysts made any downward revision but only one analyst made an upward revision of estimate.
Magnitude of Estimate Revisions
In the last 30 days, the Zacks Consensus Estimate for the quarter has decreased to a loss of 4 cents per share from a loss of 3 cents prior to that. Over the last 90 days, the Zacks Consensus Estimate for the quarter plunged to a loss of 4 cents per share from a profit of 13 cents prior to that.
Our Viewpoint
We believe that the company's outlook depends on the uncertainties in the aluminum market. We are concerned about volatile prices of aluminum and rising raw material costs.
Alcoa also faces stiff competition from Aluminum Corporation of China Limited (NYSE: ACH), Rio Tinto plc. (NYSE: RIO) and BHP Billiton Ltd. (NYSE: BHP). In view of the above stated reasons, the company retains a Zacks #3 Rank, indicating a short-term (1 to 3 months) Hold rating and we have a long-term (more than 6 months) Neutral recommendation on the stock.
AutoNation Sales Escalate 15%
AutoNation Inc. (NYSE: AN) posted a 15% increase in new vehicle sales to 25,489 units in March 2012 compared with the same month in the previous year. The company recorded improvement in sales in all of its segments.
Sales in the Domestic segment hiked 26% to 7,991 vehicles; Imports increased 10% to 13,403 vehicles and the Premium Luxury segment rose 10% to 4,095 vehicles during the month.
Last month, light vehicle sales in the U.S. grew 10% to seasonally adjusted annual rate of 14.4 million units from 13.1 million units in the same month of 2011. The increase was driven by higher demand for fuel-efficient small cars and compacts due to rising gas prices. Mild weather and increasing age of vehicles on road stimulated sales during the month.
Large vehicles also performed well during the month. The improvement was driven by attractive promotions on trucks, along with expanding opportunities in the job market and higher consumer confidence.
AutoNation offers a range of automotive products and services, including new vehicles, used vehicles, vehicle maintenance and repair services, vehicle parts, extended service contracts, vehicle protection products, and other aftermarket products.
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