ALCOA CORP (AA) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:AA - US0138721065 - Common Stock
51.25 USD
+3.07 (+6.37%)
51.58 USD
+0.33 (+0.64%)
We assign a fundamental rating of 4 out of 10 to AA. AA was compared to 156 industry peers in the Metals & Mining industry. While AA is still in line with the averages on profitability rating, there are concerns on its financial health. AA may be a bit undervalued, certainly considering the very reasonable score on growth
1. Profitability
1.1 Basic Checks
In the past year AA was profitable.
In the past year AA had a positive cash flow from operations.
In multiple years AA reported negative net income over the last 5 years.
AA had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of AA (7.18%) is better than 78.85% of its industry peers.
AA has a Return On Equity of 18.06%. This is amongst the best in the industry. AA outperforms 90.38% of its industry peers.
With a decent Return On Invested Capital value of 8.70%, AA is doing good in the industry, outperforming 73.72% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.18% | ||
| ROE | 18.06% | ||
| ROIC | 8.7% |
ROA(3y)-1.67%
ROA(5y)-0.66%
ROE(3y)-5.52%
ROE(5y)-2.51%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
AA has a Profit Margin of 8.91%. This is in the better half of the industry: AA outperforms 75.00% of its industry peers.
AA's Profit Margin has declined in the last couple of years.
AA has a Operating Margin of 10.77%. This is in the better half of the industry: AA outperforms 64.74% of its industry peers.
In the last couple of years the Operating Margin of AA has declined.
AA has a Gross Margin of 18.41%. This is comparable to the rest of the industry: AA outperforms 53.85% of its industry peers.
In the last couple of years the Gross Margin of AA has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.77% | ||
| PM (TTM) | 8.91% | ||
| GM | 18.41% |
OM growth 3Y-24.44%
OM growth 5Y-2.57%
PM growth 3Y-47.72%
PM growth 5YN/A
GM growth 3Y-14.25%
GM growth 5Y-3.06%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), AA is destroying value.
Compared to 1 year ago, AA has more shares outstanding
Compared to 5 years ago, AA has more shares outstanding
Compared to 1 year ago, AA has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 2.02 indicates that AA is not a great score, but indicates only limited risk for bankruptcy at the moment.
AA's Altman-Z score of 2.02 is on the low side compared to the rest of the industry. AA is outperformed by 69.87% of its industry peers.
AA has a debt to FCF ratio of 4.97. This is a neutral value as AA would need 4.97 years to pay back of all of its debts.
AA has a Debt to FCF ratio of 4.97. This is in the better half of the industry: AA outperforms 67.31% of its industry peers.
A Debt/Equity ratio of 0.41 indicates that AA is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.41, AA is doing worse than 72.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 4.97 | ||
| Altman-Z | 2.02 |
ROIC/WACC0.86
WACC10.06%
2.3 Liquidity
A Current Ratio of 1.56 indicates that AA should not have too much problems paying its short term obligations.
AA has a Current ratio of 1.56. This is in the lower half of the industry: AA underperforms 72.44% of its industry peers.
AA has a Quick Ratio of 1.56. This is a bad value and indicates that AA is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of AA (0.91) is worse than 75.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.56 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
AA shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 656.25%, which is quite impressive.
Measured over the past years, AA shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -48.01% on average per year.
The Revenue has grown by 16.94% in the past year. This is quite good.
Measured over the past years, AA shows a small growth in Revenue. The Revenue has been growing by 2.66% on average per year.
EPS 1Y (TTM)656.25%
EPS 3Y-48.01%
EPS 5YN/A
EPS Q2Q%-103.51%
Revenue 1Y (TTM)16.94%
Revenue growth 3Y-0.71%
Revenue growth 5Y2.66%
Sales Q2Q%3.13%
3.2 Future
The Earnings Per Share is expected to grow by 19.17% on average over the next years. This is quite good.
Based on estimates for the next years, AA will show a decrease in Revenue. The Revenue will decrease by -0.55% on average per year.
EPS Next Y288.16%
EPS Next 2Y108.01%
EPS Next 3Y72.16%
EPS Next 5Y19.17%
Revenue Next Year7.82%
Revenue Next 2Y6.96%
Revenue Next 3Y5.28%
Revenue Next 5Y-0.55%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 14.40 indicates a correct valuation of AA.
92.95% of the companies in the same industry are more expensive than AA, based on the Price/Earnings ratio.
AA's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.39.
Based on the Price/Forward Earnings ratio of 12.34, the valuation of AA can be described as correct.
AA's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. AA is cheaper than 76.28% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of AA to the average of the S&P500 Index (23.84), we can say AA is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.4 | ||
| Fwd PE | 12.34 |
4.2 Price Multiples
AA's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. AA is cheaper than 89.74% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AA is valued cheaply inside the industry as 80.13% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.57 | ||
| EV/EBITDA | 7.16 |
4.3 Compensation for Growth
AA's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
AA's earnings are expected to grow with 72.16% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.05
PEG (5Y)N/A
EPS Next 2Y108.01%
EPS Next 3Y72.16%
5. Dividend
5.1 Amount
AA has a yearly dividend return of 0.83%, which is pretty low.
AA's Dividend Yield is a higher than the industry average which is at 1.02.
Compared to an average S&P500 Dividend Yield of 1.87, AA's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
5.2 History
AA has paid a dividend for at least 10 years, which is a reliable track record.
AA has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years3
5.3 Sustainability
AA pays out 9.25% of its income as dividend. This is a sustainable payout ratio.
DP9.25%
EPS Next 2Y108.01%
EPS Next 3Y72.16%
51.25
+3.07 (+6.37%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryMetals & Mining
Earnings (Last)
Earnings (Next)
Inst Owners97.3%
Inst Owner Change22.92%
Ins Owners0.37%
Ins Owner Change0.01%
Market Cap13.27B
Revenue(TTM)12.87B
Net Income(TTM)1.15B
Analysts78.18
Price Target45.43 (-11.36%)
Short Float %2.69%
Short Ratio1
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.83% |
Yearly Dividend0.41
Dividend Growth(5Y)N/A
DP9.25%
Div Incr Years0
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)56.23%
Min EPS beat(2)21.88%
Max EPS beat(2)90.58%
EPS beat(4)4
Avg EPS beat(4)36.9%
Min EPS beat(4)3.63%
Max EPS beat(4)90.58%
EPS beat(8)7
Avg EPS beat(8)39.11%
EPS beat(12)9
Avg EPS beat(12)21.11%
EPS beat(16)12
Avg EPS beat(16)1.64%
Revenue beat(2)1
Avg Revenue beat(2)-3.05%
Min Revenue beat(2)-7.1%
Max Revenue beat(2)1%
Revenue beat(4)2
Avg Revenue beat(4)-3.03%
Min Revenue beat(4)-7.39%
Max Revenue beat(4)1.37%
Revenue beat(8)2
Avg Revenue beat(8)-2.81%
Revenue beat(12)2
Avg Revenue beat(12)-2.97%
Revenue beat(16)3
Avg Revenue beat(16)-3.12%
PT rev (1m)12.53%
PT rev (3m)30%
EPS NQ rev (1m)10.46%
EPS NQ rev (3m)83.87%
EPS NY rev (1m)5.95%
EPS NY rev (3m)15.8%
Revenue NQ rev (1m)0.66%
Revenue NQ rev (3m)5.24%
Revenue NY rev (1m)0.36%
Revenue NY rev (3m)1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.4 | ||
| Fwd PE | 12.34 | ||
| P/S | 1.03 | ||
| P/FCF | 25.57 | ||
| P/OCF | 12.49 | ||
| P/B | 2.09 | ||
| P/tB | 2.15 | ||
| EV/EBITDA | 7.16 |
EPS(TTM)3.56
EY6.95%
EPS(NY)4.15
Fwd EY8.1%
FCF(TTM)2
FCFY3.91%
OCF(TTM)4.1
OCFY8.01%
SpS49.69
BVpS24.5
TBVpS23.81
PEG (NY)0.05
PEG (5Y)N/A
Graham Number44.3
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.18% | ||
| ROE | 18.06% | ||
| ROCE | 11.01% | ||
| ROIC | 8.7% | ||
| ROICexc | 9.86% | ||
| ROICexgc | 10.03% | ||
| OM | 10.77% | ||
| PM (TTM) | 8.91% | ||
| GM | 18.41% | ||
| FCFM | 4.03% |
ROA(3y)-1.67%
ROA(5y)-0.66%
ROE(3y)-5.52%
ROE(5y)-2.51%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3Y-23.91%
ROICexgc growth 5Y3.19%
ROICexc growth 3Y-23.93%
ROICexc growth 5Y3.18%
OM growth 3Y-24.44%
OM growth 5Y-2.57%
PM growth 3Y-47.72%
PM growth 5YN/A
GM growth 3Y-14.25%
GM growth 5Y-3.06%
F-Score7
Asset Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.41 | ||
| Debt/FCF | 4.97 | ||
| Debt/EBITDA | 1.29 | ||
| Cap/Depr | 87.74% | ||
| Cap/Sales | 4.23% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 52.99% | ||
| Profit Quality | 45.29% | ||
| Current Ratio | 1.56 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z | 2.02 |
F-Score7
WACC10.06%
ROIC/WACC0.86
Cap/Depr(3y)84.05%
Cap/Depr(5y)72.99%
Cap/Sales(3y)4.59%
Cap/Sales(5y)4.15%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)656.25%
EPS 3Y-48.01%
EPS 5YN/A
EPS Q2Q%-103.51%
EPS Next Y288.16%
EPS Next 2Y108.01%
EPS Next 3Y72.16%
EPS Next 5Y19.17%
Revenue 1Y (TTM)16.94%
Revenue growth 3Y-0.71%
Revenue growth 5Y2.66%
Sales Q2Q%3.13%
Revenue Next Year7.82%
Revenue Next 2Y6.96%
Revenue Next 3Y5.28%
Revenue Next 5Y-0.55%
EBIT growth 1Y377.93%
EBIT growth 3Y-24.98%
EBIT growth 5Y0.02%
EBIT Next Year107.52%
EBIT Next 3Y34.64%
EBIT Next 5Y9.85%
FCF growth 1Y203.18%
FCF growth 3Y-57.05%
FCF growth 5Y-32.82%
OCF growth 1Y9563.64%
OCF growth 3Y-12.23%
OCF growth 5Y-1.94%
ALCOA CORP / AA FAQ
Can you provide the ChartMill fundamental rating for ALCOA CORP?
ChartMill assigns a fundamental rating of 4 / 10 to AA.
Can you provide the valuation status for ALCOA CORP?
ChartMill assigns a valuation rating of 7 / 10 to ALCOA CORP (AA). This can be considered as Undervalued.
Can you provide the profitability details for ALCOA CORP?
ALCOA CORP (AA) has a profitability rating of 5 / 10.
What are the PE and PB ratios of ALCOA CORP (AA) stock?
The Price/Earnings (PE) ratio for ALCOA CORP (AA) is 14.4 and the Price/Book (PB) ratio is 2.09.
What is the earnings growth outlook for ALCOA CORP?
The Earnings per Share (EPS) of ALCOA CORP (AA) is expected to grow by 288.16% in the next year.