Alcoa Corporation (AA) is set to release first-quarter 2022 results on Apr 20, after market close.

The company’s earnings beat estimates in each of the last four quarters, the earnings surprise being 27.08%, on average. In the last reported quarter, Alcoa’s earnings of $2.50 per share beat the Zacks Consensus Estimate of $2.04 by 22.55%.

(Click on image to enlarge)

Image Source: Zacks Investment Research

In the past three months, the company’s shares have gained 46.1% compared with the industry’s rise of 21.2%.

Factors to Consider

Alcoa is anticipated to have benefited from strong demand for aluminum and value-add products in the first quarter. High shipment volume for smelter grade alumina and aluminium on strong production supported by higher prices is likely to have augmented top-line performance of the company. Also, its efforts to improve bauxite production might have proved beneficial in the to-be-reported quarter.

Growth in popularity for the company’s Sustana and EcoSource line of products is likely to have boosted its performance in the quarter. Alcoa’s focus on operational execution and commercial effectiveness, along with its application of digital technologies in operations and cost-control measures, might have boosted its margins and profitability in the to-be-reported quarter.

However, lower shipment volume for bauxite and supply-chain challenges across end markets are likely to have adversely impacted AA’s performance in the first quarter. Also, given the company’s extensive geographic presence, its operations are subject to global economic, political risks and forex woes. A stronger U.S. dollar might have hurt Alcoa's overseas business in first-quarter 2022.

The Zacks Consensus Estimate for the company’s first-quarter total revenues is currently pegged at $3,496 million, suggesting 21.8% and 4.7% growth from the year-ago and the quarter-ago reported numbers, respectively. The consensus estimate for earnings of $3.05 implies an improvement of 286.1% year over year and 22% sequentially.

Earnings Whispers

According to our quantitative model, a stock needs to have the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) to increase the odds of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

This is not the case here as given below:

Earnings ESP: Alcoa has an Earnings ESP of -0.21%.

Alcoa Price and EPS Surprise

Alcoa price-eps-surprise | Alcoa Quote

Zacks Rank: The company sports a Zacks Rank #1.

Key Picks

Here are some other companies you may want to consider from the Zacks Industrial Products sector, as our model shows that these have the right combination of elements to post an earnings beat:

AGCO Corporation (AGCO) has an Earnings ESP of +1.91% and a Zacks Rank of 3, currently.

The Zacks Consensus Estimate for AGCO’s earnings is pegged at $1.89 per share for the to-be-reported quarter. AGCO’s shares have gained 11.8% in the past three months.

A. O. Smith Corporation (AOS Quick QuoteAOS - Free Report) has an Earnings ESP of +1.99% and a Zacks Rank of 3, currently.

The Zacks Consensus Estimate for A. O. Smith’s earnings is pegged at 76 cents per share for the to-be-reported quarter. AOS’s shares have lost 21% in the past three months.

Parker-Hannifin Corporation (PH Quick QuotePH - Free Report) has an Earnings ESP of +0.82% and a Zacks Rank of 3 at present.

The Zacks Consensus Estimate for Parker-Hannifin’s earnings is pegged at $4.61 per share for the to-be-reported quarter. PH’s shares have lost 16.5% in the past three months.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.