Based on the aggregated intelligence of 115,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, aluminum king Alcoa (NYSE: AA ) has earned a respected four-star ranking. While five-star stocks have been the best performers, our data has shown that four-star stocks still outshine the market by a significant margin and shouldn't be taken lightly; conversely, low-rated stocks have woefully lagged the market average.
With that in mind, let's take a closer look at Alcoa's business, and see what CAPS investors are saying about the stock right now.
Alcoa facts
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Headquarters (Founded)
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Pittsburgh, PA (1888)
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Market Cap
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$23.6 billion
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Industry
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Aluminum
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TTM Revenue
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$29.77 billion
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Management
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CEO Dr. Klaus Kleinfeld
CFO Charles McLane, Jr.
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Return on Equity (avg. last three years)
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13.17%
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Major Competitors
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Aluminum Corp. of China (NYSE: ACH )
Century Aluminum
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CAPS members bullish on AA also bullish on
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Vale (NYSE: RIO )
General Electric (NYSE: GE )
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CAPS members bearish on AA also bearish on
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Dell (Nasdaq: DELL )
Google (Nasdaq: GOOG )
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Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS. TTM = trailing 12 months.
Over on CAPS, fully 325 of the 359 All-Star members who have rated Alcoa -- 91% -- believe the stock will outperform the S&P 500 going forward. These All-Star bulls include reddingrunner and weiwentg, both of whom are ranked in the top 20% of our community.
In May, reddingrunner highlighted some of the stock's strong points: "High growth, low ratios, debt can be managed. Just way too cheap to ignore, the stock price has to grow into the potential here- great value stock with excellent growth prospects."
An earlier pitch from weiwentg in January 2007 agrees with that positive sentiment, expanding on Alcoa's "big picture" bull case:
[Alcoa] does have some advantages. It [controls] 24% of the world's bauxite reserves, and is a major supplier for large consumers like Boeing (NYSE: BA ) and GM. It has expanded up the value chain, and rolls sheet for aluminum cans and casts engine blocks. This helps insulate somewhat from price fluctuations in aluminum. Global demand for aluminum is increasing.
What do you think about Alcoa, or any other stock for that matter? Make your voice heard on Motley Fool CAPS today. More than 115,000 investors are waiting to hear what you have to say. CAPS is 100% free, so simply click here to get started.
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