Discussions of former monopoly and current perennial earnings leadoff batter Alcoa (Symbol: AA) filled the airwaves Monday as investors waited anxiously to see whether the Aluminum giant would kick off this earnings season with a bang. Sadly (for some), such was not the case.
The street was expecting Double-A to report $0.06 / share, but they came in with a mere $0.01.
Shares were buoyed for about 15 minutes post-report due to a beat on revenues, but soon a sell-off took hold. As of 9 PM Monday, shares had been beaten down 5.39% after hours, settling in at $16.51, the red line on the chart below.
Shares will likely face additional pressure tomorrow at the open, and it will be interesting to see whether AA trades through support levels at $14.40 and $13.80. The stock ran up significantly into earnings as investors priced in a good report, so it wouldn’t be surprising to see some significant distribution.
If you’re looking to start a position in AA, you should wait until you can be at least moderately certain that any shake-out has already taken place. Investors holding any metals or mining stocks should be on their toes throughout the day as well, as much of the sectors are likely to sell off in sympathy.
Disclosure: No positions in AA.
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