Alcoa Corporation (NYSE:AA) is one of the 9 Most Profitable Undervalued Stocks to Buy Now.
On April 16, 2026, Alcoa Corporation (NYSE:AA) reported Q1 adjusted EPS of $1.40, below the $1.51 consensus estimate, on revenue of $3.19B versus $3.27B expected. Alumina production declined 5% sequentially to 2.4 million metric tons, primarily due to seasonal maintenance at Australian refineries, while aluminum production was flat at 607,000 metric tons as progress on the San Ciprian smelter restart offset fewer operating days. In the Alumina segment, third-party shipments fell 31% sequentially due to lower externally sourced sales, seasonal weakness, and shipment delays in Australia tied to the Middle East conflict and Cyclone Narelle. Aluminum shipments declined 8%, reflecting inventory repositioning in North America and reduced trading activity, partially offset by increased volumes from the San Ciprian restart.
For Q2 2026, Alcoa expects mixed segment impacts. In Alumina, adjusted EBITDA is projected to decline by about $15M sequentially due to lower prices and volumes from bauxite offtake agreements and higher diesel costs linked to the Middle East conflict. In Aluminum, adjusted EBITDA is expected to increase by roughly $55M, driven by improved shipments, higher product premiums, lower production costs following the smelter restart, and benefits from prior inventory repositioning, partly offset by seasonally lower third-party energy sales. The company also expects Section 232 tariff costs on U.S. aluminum imports from Canada to rise by about $35M sequentially, while alumina input costs in the Aluminum segment should improve by approximately $20M. Based on current market conditions, Alcoa anticipates Q2 operational tax expense of $110M to $120M.
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Following the results, BMO Capital maintained a Market Perform rating and $75 price target, describing the Q1 miss as “explainable.” The firm noted no changes to 2026 shipment targets and pointed to rising aluminum prices and regional premiums as key drivers for a potential rebound in Q2 earnings. While some raw material costs are increasing, BMO said Alcoa’s exposure to spot energy remains limited. The firm added that although a prolonged Middle East conflict could weigh on demand, ongoing asset sales and improving free cash flow could enhance capital allocation flexibility.
Alcoa Corporation (NYSE:AA) operates across the aluminum value chain, including bauxite mining, alumina refining, and aluminum production globally.
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