What happened 

Shares of aluminum producer Century Aluminum Co (NASDAQ:CENX) fell as much as 17.7% in trading Friday after the company reported third-quarter results. At 12:25 p.m. EDT, shares had recovered slightly but were still down 14.4% on the day. 

So what

Net sales in Q3 increased 3% to $481.8 million on a 1.5% increase in shipments and slightly higher prices. But a net income of $19.4 million a year ago swung to a $20.3 million, or $0.23 per share, loss, which has to be a concern for investors. Even adjusted income, which pulls out inventory adjustments and other one-time items, was only $2.3 million, or $0.02 per share. 

Worker pouring molten metal.

Image source: Getty Images.

Results on both the top and bottom lines actually topped estimates slightly, but the stock still dropped today. That could be because of an overall market decline, which is often exacerbated in companies that are operationally leveraged to the global economy like Century Aluminum. 

Now what

The decline in earnings isn't necessarily surprising, but it's concerning that Century Aluminum isn't doing better financially in a strong economy with growing trade protections. If the U.S. or global economy does go into a recession, that could be really bad for a company barely making an adjusted profit. That tenuous financial position is what will keep me out of the stock today. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.