Primary Metals The Culprit In Alcoa's Disappointing Q3

Weighed down by a miss in the Primary Metals segment, Alcoa Inc AA kicked off the third quarter earnings season on a disappointing note, while investors are focusing on the pending company split. However, Goldman Sachs maintained its Neutral rating and six-month $30 price target.

Alcoa reported an adjusted EPS of $0.32, lower than the GS/consensus estimates of $0.37/$0.34. The Primary Metals unit delivered adjusted EBITDA $145 million versus Goldman's estimate of $163 million.

Related Link: Alcoa's Q3 Results, 2016 Guidance Look Disappointing

“Downstream results were mixed, with 2016 guidance revised slightly higher for heavy duty truck and trailer and packaging while the aero outlook continues to be talked down,” analyst Andrew Quail wrote in a note.

Looking ahead, the company now expects aero growth at the lower end of its previously revised 0 percent to 3 percent guidance range (the initial 2016 guide was 8 to 9 percent).

At time of writing, shares of Alcoa fell 9.9 percent to $28.39.