Alcoa's Q3 Surge: EBITDA Hits $455 Million in 2024

Alcoa, a leading aluminum producer based in the United States, has achieved remarkable results in Q3 2024. The company reported an impressive EBITDA of $455 million, reflecting a 6.5 times increase compared to the previous year. This performance is a result of strategic acquisitions and strong demand for aluminum, particularly in renewable energy sectors like electric vehicles and infrastructure. Furthermore, Alcoa's acquisition of Alumina Ltd. has significantly increased its alumina market exposure, enhancing its production capabilities. Looking ahead, Alcoa's shipping forecasts have improved. Management anticipates alumina shipments to reach between 12.9 to 13.1 million metric tons, exceeding previous estimates, while aluminum shipments are expected to remain stable. The company's ability to maintain lower production costs in relation to European competitors, thanks to its U.S.-based operations, positions it favorably in the market. However, Alcoa's stock performance over recent years has been unpredictable. Having seen substantial returns in 2021, the past two years showed negative returns of -23% and -24%. This volatility contrasts with the steadier returns of the S&P 500 and other investment portfolios. Despite this prior turbulence, analysts express optimism for Alcoa's future stock trajectory, buoyed by the surge in alumina prices and potential for further improvements in EBITDA. With renewed confidence stemming from recent financial results and an improving market landscape, Alcoa's stock is projected to reach about $46 per share, positioning it attractively for investors.