Alcoa’s Q2 earnings, revenue expected down YoY

Alcoa is expected to report year-over-year declines in second-quarter earnings and revenue when the metals company releases the figures Monday afternoon. The company, whose report unofficially kicks off the second-quarter reporting season, is expected to post quarterly earnings of $0.10 per share, down from $0.19 per share in the year-earlier period, according to analysts polled by Capital IQ. The analysts are predicting a drop in revenue as well, to $5.21 billion from $5.90 billion a year earlier.

Brokerage RBC Capital Markets, however, has Alcoa’s second-quarter earnings pegged at $0.09, up slightly from the first quarter’s adjusted profit of $0.07 per share due to higher alumina and aluminium prices as well as positive improvements in the downstream business.

The firm said it expects weakness in primary metals to be offset by strong earnings in alumina. In a regulatory filing last week, Alcoa detailed its plans to split into two separate companies. Under the split, the part of the company now referred to as Alcoa Upstream will take the Alcoa name and hold the company’s upstream and North American packaging businesses. The current Alcoa’s other businesses will remain within the existing company, which will be renamed Arconic and be listed on the New York Stock Exchange under ticker ARNC. The separation is expected to be completed in the second half of 2016.

The stock is down 0.10 per cent or $0.01 after the news, hitting $9.81 per share. About 25.92M shares traded hands or 31.37 per cent up from the average. Alcoa Inc stock has declined 1.48 per cent since December 1, 2015 and is downtrending. It has underperformed by 1.25 per cent the S&P500.