Alcoa Earnings: Margins Keep Growing, Net Income Climbs

Strong revenue helped Alcoa AA see its net income grow in the most recent quarter, mainly due to climbing revenue. To figure out why, let's first dig into the numbers. Then we can look a bit deeper and see what steps you can take. The Big Numbers: The company reported EPS of 28 cents/share versus the 27 cents/share estimate and revenues of $6.58 billion versus the $6.32 billion estimate. Alcoa managed to exceed Wall Street estimates with stronger-than- expected EPS and revenues. EPS rose 115.4% while revenue climbed 27% from the same period last year. Over the last five quarters, revenue has increased 17.9% on average year over year. The biggest increase came in the most recent quarter, when revenue rose 27% from the year earlier quarter. Revenue has risen the past four quarters on a year-over-year basis. Income: For the year, Alcoa reported net income of 78 cents per share. The company trumped analyst projections of 64 cents by 21.9%. According to the reported number, the company's income rose 136.8% from last year's levels. Official Comment: “We turned in another strong quarter, with solid revenue and earnings growth,” said Alcoa Chairman and CEO Klaus Kleinfeld. “Across the Company, our team is delivering outstanding results through our constant focus on execution and by reinventing what customers believe is possible through innovation. “Although the economic recovery is uneven, the overall outlook for Alcoa - and for aluminum - remains positive,” Kleinfeld said. “Demand for aluminum continues to rise and so does growth in our major markets. These factors support our projection that aluminum demand will grow 12 percent this year and will double by 2020.” What to Do Next: Now that you've gotten a round up of Alcoa's latest numbers, you can make a better-informed decision about whether to buy, sell or hold those shares. Whatever you do, be sure to visit us before the company's next earnings release for a full preview.