Monday, January 9, 2012

Alcoa (AA) Could Jump in 2012 on Production Cuts

Aluminum production is being cut back in 2012 as prices continue to weaken in the weak global economy. That could be beneficial to Alcoa (NYSE:AA) and other companies with significant exposure to aluminum.

That, however, won't help Alcoa in its latest quarter, which is expected to announce a loss after the market closes. Consensus is for the company to report a 2 cents a share loss, with Citigroup (NYSE:C) going against consensus, seeing it being much worse for the aluminum producer, saying they're looking for a loss of 7 cents a share for the quarter.

If production cuts are in align with assertions in 2012, it could be beneficial to Alcoa, as it could help boost aluminum prices because of lower demand.

Alcoa was trading at $9.33, up $0.17, or 1.86 percent, as of 12:03 PM EST.

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