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Morgan Stanley Hikes Alcoa's Q4 Estimates

Courtesy of Benzinga.

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Paretosh Misra of Morgan Stanley revised his fourth-quarter estimates for Alcoa Inc (NYSE: AA) on Wednesday, while maintaining an Overweight rating and $20 price target.

Misra is now projecting Alcoa to earn $0.30 per share in the fourth quarter, up from a prior estimate of $0.25.

According to Misra, every $10 per barrel change in oil prices translates to an $80 million to $90 million change in annual EBITDA for Alcoa. The analyst believes that aluminum producers benefit from lower anode costs and lower fuel oil costs.

Looking forward, Misra is projecting Alcoa’s first quarter 2015 earnings per share should improve “sequentially” by $0.03 per share if spot prices remain at current levels.

Finally, Misra believes that Alcoa could announce production cuts at its Spanish smelters early next year, which could prove to be a “catalyst” for the aluminum sector.

Latest Ratings for AA

Date Firm Action From To
Dec 2014 Wells Fargo Initiates Coverage on Outperform
Dec 2014 Citigroup Maintains Neutral
Oct 2014 Deutsche Bank Upgrades Hold Buy

View More Analyst Ratings for AA
View the Latest Analyst Ratings

Posted-In: Aluminum Morgan Stanley oil prices Paretosh MisraAnalyst Color Analyst Ratings

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