Trump’s tariffs weigh on Alcoa

Article Excerpt

ALCOA CORP. $45 (New York symbol AA; Conservative Growth Portfolio, Resources sector; Shares outstanding: 185.0 million; Market cap: $8.3 billion; Price-to-sales ratio: 0.7; No dividends paid; TSINetwork Rating: Average; www.alcoa.com) is down 18% since the start of the year despite new tariffs on aluminum imports to the U.S. The decline is because roughly 70% of Alcoa’s overall aluminum production comes from its facilities outside the U.S. As well, its Canadian operations supply a third of its overall production. Even so, the company should continue to benefit from its restructuring plan, which involves closing older, less-efficient smelters. As a result, Alcoa will probably earn $4.52 a share in 2018, up 50.2% from $3.01 in 2017. The stock trades at just 10.0 times that estimate. Alcoa is still a buy. buy…

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