Analysts Just Trimmed Price Targets for These 5 Stocks

01. Alcoa Corporation (NYSE:AA)

Price Reaction after the Price Target Cut: -1.51 (-5.14%)

Alcoa Corporation (NYSE:AA) operates in the aluminum industry, specializing in producing aluminum and aluminum-related products. On September 21, Morgan Stanley reduced its price target for Alcoa Corporation (NYSE:AA) from $31.00 to $28.00, indicating a lowered expectation for the stock’s potential value. Morgan Stanley has also maintained its “Underweight” rating for Alcoa Corporation (NYSE:AA), which implies a bearish outlook on the stock, suggesting it may underperform relative to other investments. Following this update, Alcoa Corporation (NYSE:AA) stock is trading at $27.87, reflecting a 5.1% decline in response to Morgan Stanley’s target price adjustment. This development underscores the cautious sentiment among analysts regarding the aluminum industry and Alcoa Corporation (NYSE:AA) performance within it.

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.”

Disclosure: None. You can also take a look at 10 Best Lithium ETFs and 20 Countries with Highest Rice Consumption Per Capita.