Alcoa (NYSE:AA) kicked off the earnings season yesterday with its third-quarter numbers, reporting earnings of $0.34 per share, in line with estimates. But the aluminum giant also reported revenues for the quarter of $5.97 billion, disappointing the consensus of $6.13 billion.

A top-line disappointment should not be a surprise for followers of Alcoa. For the last three quarters, the company has let investors down by missing on the bottom line. This trend of missing one estimate or another has been a constant, even though aluminum prices continue to trade higher. I admit I'm a little confused.

Revenue grew 13% over the third quarter of 2003, yet earnings only grew by 3%. Does this confuse you?

Management cited several factors for the shortfall. Hurricane Ivan caused the Jamalco refinery to shut down; there was a strike at the Becancour, Quebec, smelter (I get a hoot out of the word smelt); and a plant in Pennsylvania had a fire. If it weren't for bad luck, Alcoa would have no luck at all. Investors seem to be taking the report in stride, though, as shares are up almost 1.5% in trading so far today.

Back in early July, I wrote an article recapping the second quarter and arguing that after another earnings disappointment, even with aluminum at a then multi-year high, it made sense to avoid the stock.

Was that right? Yes and no. Alcoa outperformed the S&P 500 since then, but very slightly lagged the Materials Sector SPDR (ASE: XLB). If you bought this stock three months ago, you assumed single-stock risk without the benefit of outperforming the sector. Typically, you would buy an individual stock that you believe gives you a chance to outperform. Why take the risk if you won't beat the group?

The thing that concerned me back then was that the report should have been great because of the high spot price of aluminum and ever-increasing demand from China. Instead, the results were not great and the comments were tempered. Looking forward, not much has changed at the company. Management is guarded and the spot price for aluminum is about 8% higher than it was three months ago. One new threat could be the price of oil. Typically energy costs are a factor for stocks in the materials sector.

This analysis was a very simple one. Occasionally, stock selection can be this simple. Bad answers to common-sense questions can help you avoid stocks destined to lag.

Fool contributor Roger Nusbaum is an investment manager and wildland firefighter in Prescott, Ariz. At press time, neither he nor his clients owned any stocks mentioned.