Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Has the First Reporting Company Rounded the Bend?

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

Alcoa (NYSE: AA  ) typically plays a pace car role during earnings season. The company is the first of the Dow Jones Industrial contingent off the starting line, and thereby provides some indication of what may occur as other companies follow.

This time its leadoff for the emerging recitation of results for the first quarter of 2010 represented a number of improvements. For the period, the company recorded a loss of $201 million, or $0.20 per share. Not good, but better when compared to a loss of $497 million, or $0.61 a share for the same quarter a year ago. And if you back out the $295 million in one-time charges -- versus $69 million in the March 2009 quarter -- Alcoa would have chalked up $0.10 per share in earnings for the latest quarter. And while the expectations were for revenues of $5.24 billion, rather than the actual $4.89 billion, the operating profit was right on target.

Looking at the individual segments, Alumina reported after-tax operating income (ATOI) of $72 million, up from just $19 million in the sequentially prior quarter. At the same time, Primary Metals checked in with ATOI of $123 million, fully $337 million higher sequentially. Flat-Rolled Products dipped $7 million to $30 million in ATOI compared to the previous quarter. And finally, despite lower sales, the Engineered Products and Solutions segment engineered a 42% ATOI increase.

So the Alcoa numbers showed enough improvement overall that I'm eagerly awaiting releases from its smaller cousins, Century Aluminum (Nasdaq: CENX  ) and Kaiser Aluminum (Nasdaq: KALU  ) , the week after next. It'll be especially noteworthy if they are as optimistic as Alcoa CEO Klaus Kleinfeld during his company's conference call.

As you know, aluminum finds its way into a variety of aerospace applications, among other things. Mr. Kleinfeld was quick to note that both Boeing (NYSE: BA  ) and Airbus have six year order backlogs on their books. Beyond that, he also pointed out that "global automotive production [is] expected to rebound in 2010; plus 9% is our expectation, 62.2 million vehicles, that's pretty much in every region except Europe." As he also pointed out, automotive sales were strong during March, with both Toyota (NYSE: TM  ) and Ford (NYSE: F  ) jumping 40% year over year.

So my feeling is that Alcoa may be rounding the bend toward a meaningful strengthening. On that basis, and while there clearly remain economic questions to be answered in its sector, I'd suggest that Fools watch this big aluminum company very closely.

Fool contributor David Lee Smith doesn't own shares in any of the companies named. He does welcome your comments. Ford Motor is a Motley Fool Stock Advisor pick. Try any of our Foolish newsletters today, free for 30 days. The Motley Fool has a disclosure policy that won't rust, crack, or peel.

Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On April 24, 2010, at 12:56 AM, SilviaY wrote:

    Business today are having a hard time keeping up their track. Cars have played a major important role in our life. And I thought The United States had too numerous cars. <a href=" has the largest automobile market in the world, yet their person to vehicle ratio is only 1 automobile to each and every 20.8 individuals. In America, ours is 1 car to each 2.5 individuals, don't ask me where the fraction of a person fits in, but its present. China is so densely populated the car industry there is growing too large and also the Chinese Government must do something to stop it. Their solution is to increase the small car tax in hopes of less people being willing to buy a car.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1152013, ~/Articles/ArticleHandler.aspx, 10/25/2016 5:06:27 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,169.27 -53.76 -0.30%
S&P 500 2,143.16 -8.17 -0.38%
NASD 5,283.40 -26.43 -0.50%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/25/2016 4:00 PM
AA $27.29 Up +0.43 +1.60%
Alcoa CAPS Rating: ***
BA $139.02 Up +1.57 +1.14%
Boeing CAPS Rating: ****
CENX $7.45 Up +0.02 +0.27%
Century Aluminum CAPS Rating: ***
F $11.85 Down -0.19 -1.58%
Ford CAPS Rating: ****
KALU $72.46 Up +0.89 +1.24%
Kaiser Aluminum CAPS Rating: ****
TM $115.25 Down -0.20 -0.17%
Toyota Motor CAPS Rating: ***