Alcoa shares hit ahead of earnings report
Deutsche Bank cuts Dow component to sell, trims price target
By Matt Andrejczak, MarketWatch
Last update: 11:33 a.m. EST Jan. 12, 2009SAN FRANCISCO (MarketWatch) --
Shares of Alcoa Inc. faced more selling pressure Monday, ahead of the aluminum giant's afternoon earnings report, after an analyst downgraded the stock and warned the company could face weak aluminum prices through 2010.
Alcoa shares fell 8% to $9.93, putting its decline over the past week at 18%.
Deutsche Bank cut Alcoa shares to sell, from hold, and shaved its price target to $8 from $10. Analyst Jorge Beristain projects Alcoa will lose 17 cents a share in the fourth quarter, after charges to account for production cuts and other restructuring moves unveiled last week.
Alcoa is expected to post a loss of 16 cents a share, compared to a profit of 36 cents in the year-ago period, while sales are projected to drop 29% to $5.2 billion, according to a FactSet Research analyst survey.
Investors are betting big against Alcoa. The short interest in Alcoa shares is at its highest level since 1998 and five times its average level over that 10-year time period. Short sellers are investors who bet a stock will drop over time, rather than gain in value.
To help weather the global economic downturn, Pittsburgh-based Alcoa last week unveiled a number of measures last week to conserve cash. The aluminum giant plans to cut 13,500 jobs, close plants, curb aluminum output and slash capital expenditures by 50%.
It also intends to sell four consumer-related business units that lost a combined $105 million in 2008 after taxes. Read more on Alcoa job cuts.
Those actions may not be enough, according to a few analysts. They argue Alcoa may be forced to cut its dividend, which equals 68 cents a share on an annual basis, and cut more production to save cash if aluminum prices stay at depressed levels.
Alcoa shares are one of the worst performers among the components in the Dow Jones Industrial Average. The stock is down 68% over the past year, putting it in close company with General Motors, Citigroup and Bank of America.
Was mich bei dem Preis nur wundert, der Einbruch von 44US auf nun 10US, was ist da schon eingepreist. Sind das nur die verpufften Hoffnungen auf weitere Jahre Rohstoffboom, so wie es noch 2008/1 aussah oder schon die Vorwegnahme einer schweren Liquiditätskrise, die von den Bären an die Wand gemalt wird.
Wann ist also der Kurs wirklich günstig. Wer es weiß, bekommmt nen Preis :)