5 Best Aluminum Stocks To Buy

1. Alcoa Corporation (NYSE:AA)

Number of Hedge Fund Holders: 44

Pennsylvania-based Alcoa Corporation (NYSE:AA) is the world’s eighth biggest producer of aluminum. Over the past six months, the stock has gained about 17% in value despite the challenging macroeconomic environment and uncertainty in the commodities market. Analysts believe the company has secular growth catalysts in the automotive, packaging and aerospace markets. As auto companies strive to increase the fuel efficiency of ICE vehicles and the range of BEV vehicles, Alcoa is set to enjoy increasing demand.  Alcoa Corporation (NYSE:AA) produces aluminum and fabricated aluminum and plays a key role in all aspects of the industry, including mining, refining, smelting, fabricating, and recycling.

As of the end of the third quarter of 2022, 44 hedge funds tracked by Insider Monkey reported having stakes in Alcoa Corporation (NYSE:AA), compared to 39 funds in the previous quarter. The total value of these stakes was $580 million.

ClearBridge Investments made the following comment about Alcoa Corporation (NYSE:AA) in its Q3 2022 investor letter:

“We bought Alcoa Corporation (NYSE:AA), a leading aluminum producer, after the stock sold off over lower commodity prices. The current price of aluminum is unsustainably low, below its cost of production, despite inventories being at historic lows. We believe these depressed prices are due to the evaporation of Chinese demand resulting from its zero COVID-19 policy, but that it will likely recover over the next few quarters.

Additionally, Alcoa is leading the industry in reducing carbon emissions from its smelting process which is helping to improve its cost position relative to global competitors. Given its compelling valuation and strong free cash flow yield, we are confident in the company as it is increasingly relied upon to meet the growing structural demand from electrification and the global energy transition.”

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