Alcoa set to gain with aluminum

Article Excerpt

ALCOA INC. $35 (New York symbol AA; WSSF Rating: Above average) is the world’s largest producer of aluminum. It also makes a wide variety of aluminum and non-aluminum products, such as food containers and automotive parts. Worldwide aluminum consumption will probably double over the next 15 years, mostly due to spreading prosperity in Asia and other developing regions. Alcoa aims to take advantage of this growth with new smelters and other facilities that will increase its total output. It recently upgraded its facilities in Australia and Brazil, and plans to open major new smelters in Iceland and Norway next year. Capital spending rose from $1.31 a share in 2004 to $2.53 a share in 2005, and should hit $2.85 a share this year. Thanks to strong aluminum demand and prices, Alcoa’s profits from continuing operations in the three months ended March 31, 2006 jumped to $0.70 a share (total $615 million) from $0.31 a share ($268 million) a year earlier. The company’s ongoing cost…

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