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What this page is: Delvantic's full research page for Alcoa Corporation (AA) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-09-11): Designation Low · Gem Score -60 (−100…+100 Quality+Value blend) · Quality -37 · Value -76 · Sentiment -38 (timing only, not weighted)
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Alcoa Corporation
AA NYSEAlcoa Corporation is a global aluminum company focused on the production of bauxite, alumina, and primary aluminum. Its operations cover the full upstream value chain, from mining bauxite ore and refining it into alumina to smelting, casting, and supplying aluminum products for industrial use. The company serves customers in transportation, building and construction, packaging, wire, and other manufacturing sectors, where lightweight and durable metals are essential. Alcoa also operates energy assets that support its industrial operations and provide power in selected markets. With a business structure organized around Alumina and Aluminum segments, Alcoa Corporation plays an important role in the global materials market by supplying core inputs used across a wide range of downstream industries.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 4.37
Total Equity: $6.19B
Shares: 261,000,000
Total Debt: $2.44B
Cash: $1.60B
EBITDA: $2.47B
Total Debt: $2.44B
Cash: $1.60B
Revenue: $12.83B
Revenue: $12.83B
Revenue: $12.83B
Total Equity: $6.19B
Tax Rate: -5.2%
Equity: $6.19B
Total Debt: $2.44B
Cash: $1.60B
Current Liabilities: $3.80B
Long-Term Debt: $2.44B
Total Debt: $2.44B
Total Equity: $6.19B
Shares: 261,000,000
Shares: 261,000,000
CapEx: -$618.00M
Shares: 261,000,000
Stock Price: $49.98
Net Income: $1.16B
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 15, 2026 11:37am (26d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $12.2B | $12.5B | $10.6B | $11.9B | $12.8B |
| Cost of Revenue | $9.2B | $10.2B | $9.8B | $10.0B | $10.7B |
| Gross Profit | $3.0B | $2.2B | $738.0M | $1.9B | $2.2B |
| Operating Expenses | $258.0M | $236.0M | $265.0M | $332.0M | $323.0M |
| Operating Income | $2.7B | $2.0B | $473.0M | $1.5B | $1.9B |
| Net Income | $429.0M | -$123.0M | -$651.0M | $60.0M | $1.2B |
| EBITDA | $3.4B | $2.6B | $1.1B | $2.2B | $2.5B |
| EPS | $2.30 | $-0.68 | $-3.65 | $0.26 | $4.40 |
| EPS (Diluted) | $2.26 | $-0.68 | $-3.65 | $0.26 | $4.37 |
Balance Sheet (Annual)
Last updated: Aug 15, 2026 11:18am (26d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $1.8B | $1.4B | $944.0M | $1.1B | $1.6B |
| Total Current Assets | $5.0B | $5.3B | $4.4B | $4.9B | $5.5B |
| Total Assets | $15.0B | $14.8B | $14.2B | $14.1B | $16.1B |
| Current Liabilities | $3.2B | $3.0B | $3.0B | $3.4B | $3.8B |
| Long-Term Debt | $1.7B | $1.8B | $1.7B | $2.5B | $2.4B |
| Total Liabilities | $8.7B | $8.2B | $8.3B | $8.9B | $9.9B |
| Total Equity | $6.3B | $6.6B | $5.8B | $5.2B | $6.2B |
| Retained Earnings | -$315.0M | -$570.0M | -$1.3B | -$1.3B | -$271.0M |
Cash Flow (Annual)
Last updated: Aug 15, 2026 11:37am (26d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $920.0M | $822.0M | $91.0M | $622.0M | $1.2B |
| Capital Expenditure | -$390.0M | -$480.0M | -$531.0M | -$580.0M | -$618.0M |
| Free Cash Flow | $530.0M | $342.0M | -$440.0M | $42.0M | $567.0M |
| Acquisitions (net) | — | — | — | — | — |
| Net Debt Issued / (Repaid) | -$1.3B | -$1.0M | -$72.0M | -$679.0M | -$1.2B |
| Dividends Paid | -$19.0M | -$72.0M | -$72.0M | -$89.0M | -$104.0M |
| Stock Buybacks | -$150.0M | -$500.0M | $0 | $0 | — |
| Net Change in Cash | $314.0M | -$450.0M | -$427.0M | $187.0M | $458.0M |
Growth Trends (YoY %)
Last updated: Aug 15, 2026 11:37am (26d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +2.5% | -15.3% | +12.7% | +7.9% |
| Gross Profit Growth | -25.3% | -67.0% | +150.8% | +17.4% |
| Operating Income Growth | -26.9% | -76.4% | +221.1% | +21.8% |
| Net Income Growth | -128.7% | -429.3% | +109.2% | +1,828.3% |
| EBITDA Growth | -23.1% | -57.8% | +95.6% | +14.4% |
Dividend History (Last 20)
Last updated: Aug 15, 2026 11:18am (26d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-08-11 | $0.10 | — | — | — |
| 2026-05-19 | $0.10 | — | — | — |
| 2026-03-10 | $0.10 | — | — | — |
| 2025-11-04 | $0.10 | — | — | — |
| 2025-08-12 | $0.10 | — | — | — |
| 2025-05-20 | $0.10 | — | — | — |
| 2025-03-04 | $0.10 | — | — | — |
| 2024-10-29 | $0.10 | — | — | — |
| 2024-08-12 | $0.10 | — | — | — |
| 2024-05-20 | $0.10 | — | — | — |
| 2024-03-04 | $0.10 | — | — | — |
| 2023-10-30 | $0.10 | — | — | — |
| 2023-08-07 | $0.10 | — | — | — |
| 2023-05-15 | $0.10 | — | — | — |
| 2023-03-06 | $0.10 | — | — | — |
| 2022-10-31 | $0.10 | — | — | — |
| 2022-08-08 | $0.10 | — | — | — |
| 2022-05-16 | $0.10 | — | — | — |
| 2022-03-07 | $0.10 | — | — | — |
| 2021-10-28 | $0.10 | — | — | — |
Deep Analysis
Risk : Reward — upside vs downside from this company's own quarters
Not computed yetNarrative Economics
market-narrative step).
Growth Outlook
Analyzed 2026-08-17 16:36The question every valuation on this page silently assumes: is this company likely to grow? Judged forward — the business, its category, the world — against what's already printed.
Claude Reading
Looking at the raw numbers first: Alcoa's TTM revenue is roughly $12.66B with net income around $1.03B (summing the last four quarters: $425+$213+$232+$164M = $1.03B), yielding a trailing net margin near 8% and EPS around $3.90 on ~264M shares. At $49.98 that's a P/E of ~13x trailing, not 11x — and the March 2026 quarter at 13.3% net margin is a genuine step-up, not a peak-cycle print (Q1 2025 already hit 16.3% at similar revenue). The annual trajectory is striking: NI went from -$651M (2023) to $60M (2024) to $1.16B (2025). Operating margin expanded from 4.5% to 14.4% in two years on only 21% revenue growth — that's operating leverage on aluminum/alumina spreads, exactly the kind of move that mean-reverts. FCF of $567M against a $13.2B market cap is a 4.3% yield; not cheap for a cyclical at what may be mid-to-late cycle earnings.
The synthesis verdict pegging fair value at $27.42 strikes me as too aggressive on the downside. That implies capitalizing something like $300-400M of normalized earnings — essentially assuming 2023-style trough conditions are the mean. But Alcoa in 2021 earned $429M at similar revenue and 2022 generated $2B in operating income before writedowns crushed the bottom line. A mid-cycle normalized earnings power of ~$700-800M seems more defensible, which at 10-12x gets you $28-36 — closer to the synthesis but not that low. The Market Forces "value trap" framing and the Narrative layer's "$27 intrinsic" both anchor on trough assumptions. I'd argue fair value is $35-42, meaning the stock is overvalued by 15-30%, not 45%.
The contrarian case worth taking seriously: aluminum LME has structural tailwinds the bears dismiss — Chinese capacity is genuinely capped at 45Mt, Section 232 tariffs got extended, and Rusal supply remains sanction-constrained. The Q1 2026 acceleration (13.3% margin, revenue rebounding to $3.19B from a soft Q2-Q3 2025 dip) suggests spreads are holding, not collapsing. ROIC of 27.6% is real — this isn't 2019 Alcoa. However, several red flags corroborate the bearish synthesis: FCF quality is weak ($567M FCF on $1.16B NI = 49% conversion, poor), the insider "transactions" are all identical 2,532-share awards on the same day (that's a board grant, not conviction buying — the "No Insider Transactions" secondary signal is more accurate than the raw data suggests), and the Q2/Q3 2025 margin compression to 5-8% shows how fast the earnings power evaporates when spot prices wobble. The 1828% "recent earnings YoY" is a base-effect artifact off the $20M Q2 2024 print and is meaningless.
I land at partial agreement with the overvalued call but dissent on the magnitude. The models are stacking narrative-fragility, macro-headwinds, weak FCF quality, and DCF-at-$27 into a chorus that feels overdetermined — five bearish signals citing the same underlying concern (cyclical mean reversion) isn't five independent signals. Data thinness matters: we have no explicit LME aluminum price series, no segment breakdown between alumina and aluminum, and the balance sheet is only annual — I can't see if the recent quarter's earnings converted to cash or working capital. The 41% drawdown from 52-week highs the pre-flight mentions already prices in meaningful skepticism; shorting into that or selling at $50 assumes another 45% downside that requires aluminum to break decisively. My read: fair value $36-40, current $49.98 is ~25% rich, and the asymmetry favors patience over shorting given tariff/supply optionality. Don't own it here, but the $27 target is a trough scenario dressed as a base case.
GPT Reading
At $49.98, Alcoa is not obviously expensive on headline multiples, but the underlying earnings stream is too cyclical and too inconsistent to pay up for with confidence. The core fact pattern is that revenue has recovered from $10.55B in 2023 to $11.90B in 2024 and $12.83B in 2025, while net income swung from -$651M to $60M to $1.16B. That is not a steady compounding business; it is a spread business catching a favorable part of the cycle. Quarterly numbers tell the same story. In just eight quarters, net margin moved from 0.7% to 16.3%, then back to 5%-8%, then up again to 13.3% in the latest quarter. When a commodity producer can earn $20M one quarter and $548M three quarters later on broadly similar revenue bands around $2.9B-$3.5B, the conclusion is simple: valuation must be anchored to normalized earnings, not the best recent print.
What stands out most is that the market is already capitalizing a strong environment as if it were durable. On 2025 annual results, the stock trades at about 11.4x earnings, 5.6x EV/EBITDA, and 1.0x sales, which would look cheap for a stable industrial. But Alcoa is not a stable industrial. 2025 operating income of $1.85B on $12.83B of revenue implies a 14.4% operating margin; compare that with 4.5% in 2023 and the fact that 2024 net income was only $60M despite $11.90B of sales. That spread between “good year” and “bad year” is the business. The balance sheet is respectable, not stressed—$2.44B debt against $1.60B cash and $6.19B equity, with debt/equity at 0.39 and current ratio 1.44—but that mainly limits downside in a slump; it does not make peak-ish earnings worth a premium multiple. Even free cash flow of $567M in 2025 is less impressive than the income statement suggests, because it sits well below the $1.16B of net income and reflects a capital-intensive asset base that has to keep spending.
That is why I don’t buy the more dramatic “collapse to the high-$20s” framing on faith, but I do think the stock is rich relative to a mid-cycle earnings base. If you annualize the latest quarter’s $425M net income, you get a misleadingly strong run rate of $1.7B+, which would make $50 look cheap. But the previous three quarters were $164M, $232M, and $213M, and 2024 showed how quickly profits compress despite similar revenue. A more reasonable normalized earnings range is something like $700M-$900M, not because the business is broken but because aluminum producers rarely hold 2025-style profitability through the cycle. Put even a fair 10x-11x multiple on $800M normalized earnings and equity value lands closer to the mid-$30s to low-$40s than $50. The low dividend yield of 0.8% also tells you investors are not being paid much to wait through cyclicality.
The best case against my view is straightforward: recent fundamentals are better than the skeptical narrative admits. Revenue is not exploding, but it is holding above $12B annualized, gross margin improved to 16.9% in 2025, ROE reached 18.7%, ROIC screens at 27.7%, and the latest quarter’s 13.3% net margin suggests operating leverage is very real. If 2024 was the trough and 2025-2026 represent a structurally better aluminum market, then 11x trailing earnings and 5.6x EV/EBITDA could actually be cheap, especially with manageable leverage. There is also an argument that the company deserves a better multiple than history because the balance sheet can withstand volatility and the industry setup may be tighter than in prior cycles. I weigh that differently because the data here still show profits moving far more violently than revenue, which is classic evidence of a producer whose economics are set by external pricing, input costs, and mix rather than by a durable internal moat.
What would change my mind is not another one-off strong quarter but evidence that high profitability is sticking across conditions. If Alcoa can produce the next 12 months at roughly $12.5B-$13.0B revenue while keeping net income above $1.2B and free cash flow closer to $900M-$1.0B than $500M, then the current price would look more defensible and perhaps cheap. I would also want to see that margins do not collapse when quarterly revenue dips back toward the $3.0B area; if the company can still earn, say, 8%-10% net margins in that setup, then the business is more resilient than I assume. Absent that, I think the stock is being valued off favorable cycle math rather than normalized economics.
Grok Reading
Alcoa’s 2025 results mark a sharp cyclical recovery rather than a structural re-rating of the franchise. Revenue climbed to $12.83B from $11.90B, but the real story is the earnings swing: net income of $1.16B versus $60M in 2024 and a $651M loss in 2023, lifting operating margin to 14.4% and net margin to 9.0%. Trailing multiples look deceptively cheap—11.4x earnings, 5.6x EV/EBITDA, 1.0x sales—yet they are calculated almost entirely on what appears to be peak-cycle profitability. Free cash flow of $567M against a $13.2B equity value yields only about 4.3%, and that is after a year in which aluminum spreads and energy costs aligned unusually well. The balance sheet is serviceable (net debt roughly $840M, debt-to-equity 0.39, current ratio 1.44), and Q1 2026 still printed a solid $425M of net income on $3.19B of revenue at a 13.3% margin, so the cycle has not obviously rolled over yet. Still, the five-year history shows how quickly those margins vanish: 2022 and 2023 produced losses on similar or only modestly lower revenue bases. ROE of 18.7% and ROIC of 27.7% are therefore trailing artifacts, not durable returns on capital in a capital-intensive, price-taking industry.
The prior models’ $27 composite fair value implies the market is paying an 80%+ premium for a narrative of sustained green-metal demand and energy-cost advantage. That premium is real in the price, but the quantitative haircut looks aggressive given still-elevated near-term cash generation and a clean enough balance sheet to survive the next downturn. What stands out is the mismatch between “cheap on peak” optics and the fragility of the earnings power itself; FCF quality is already flagged as weak, revenue growth is only mid-single to low-double digits, and there is zero open-market insider buying to corroborate management confidence. At $50 the stock is priced as if mid-teens margins and billion-dollar-plus annual profits can persist for several years—an assumption history repeatedly punishes in aluminum.
The strongest contrary case is straightforward: if aluminum prices and alumina spreads remain elevated because of EV/renewables intensity, Western supply discipline, and tariff or carbon-border support, then 11x trailing earnings and mid-single-digit EV/EBITDA on a company generating >$1B of net income and >$500M of FCF is simply not expensive, and the stock can grind higher or hold while cash accumulates. The integrated upstream position and any incremental low-carbon premium would then justify a higher through-cycle multiple than the pure mean-reversion models embed. I weigh that less heavily because Chinese capacity, energy-cost volatility, and the historical amplitude of Alcoa’s own P&L still dominate; the 2021–2024 average earnings power was a small fraction of 2025’s print, and nothing in the capex or competitive data suggests the company has permanently escaped that cycle.
What would flip the view is concrete evidence that mid-cycle earnings power has reset higher—specifically, two more consecutive quarters of net margins holding above ~10% even if LME aluminum softens 10–15%, or a sustained step-up in FCF above $800M that funds either meaningful deleveraging or a higher payout without sacrificing the asset base. Conversely, a return toward 2023–2024 margin levels or a drop in annualized NI below ~$500M would confirm the $27–35 zone as the right anchor and make $50 look clearly excessive.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
Alcoa is a classic cyclical aluminum producer whose income statement swings hard with the commodity: revenue oscillated between 10.55B and 12.83B over five years while operating margin collapsed from 22.6% in 2021 to 4.5% in 2023 before recovering to 14.4% in 2025. 2025 net income of 1.16B and FCF of 567M look strong on the surface, but the four-year FCF stack (530, 342, -440, 42, 567) averages only about 208M/yr on a business doing roughly 12B in revenue - thin and lumpy cash generation for the asset base. Earnings quality checks are clean (OCF/NI 1.34x, accruals -3.8%, Beneish -2.44), so the reported 2025 recovery appears real, not accrual-driven. The balance sheet is workable but not a cushion: 1.60B liquid cash against net debt of 842M, and Altman Z of 2.07 sits in the grey zone. Self-funding today, constrained tomorrow if the cycle turns. The most damaging quality fact is dilution: diluted shares went 190M to 261M (8.3% CAGR, ~37% cumulative), largely tied to the Alumina Ltd acquisition rather than SBC (SBC only 0.3% of revenue, buyback/SBC 340%). Whatever per-share earnings power the recovery creates is being handed back to a much larger share base. Insider tape is entirely awards and tax withholdings - no directional P or S transactions to read.
Verify before trusting this (6)
- Whether the 261M share count reflects the completed Alumina Ltd acquisition and if further issuance is contemplated
- Debt maturity schedule and covenant headroom given 842M net debt and grey-zone Z-score
- Segment split between alumina and aluminum and exposure to specific smelter/refinery assets
- Sustainability of 2025 margin recovery vs. aluminum/alumina spot pricing
- Any tariff, energy-cost, or curtailment exposure disclosed in the 10-K
- Pension and asset-retirement obligation size relative to reported net debt
The composite fair value of $26.78 and signal-adjusted $27.42 sit roughly 45% below the $49.98 price. The DCF at $1.96 is a runaway output I discount entirely (a cyclical trough-cash DCF is not meaningful here), but the EPV floor of $35.62 is the more credible anchor and still sits ~29% below spot. Only the anchored-PE of $67.59 supports the price, and it does so by capitalizing a fresh-cycle earnings print on a business whose share count is up 37% in four years and whose through-cycle margins routinely halve. Blending the credible methods (EPV floor plus a haircut to the PE anchor for cyclicality and dilution) lands deserved value in the low-to-mid $30s. Against $49.98 that is a 30-40% overshoot - the market is paying for sustained aluminum strength, green-metal demand, and no Chinese supply response. Quality is Mixed, not high, so I do not add a premium for the franchise. Earnings quality is fine but the dilution history means every share of future FCF is being split more ways than the PE anchor assumes. Verdict: priced for a benign cycle to persist; margin of safety is negative.
Verify before trusting this (5)
- Through-cycle aluminum realized price assumption embedded in sell-side 2026-27 EPS
- Any further equity issuance or buyback authorization in latest filings
- Energy input cost trajectory and hedging disclosure
- Alumina segment margin sustainability vs 2025 spike
- Guidance on capex and free cash conversion at mid-cycle prices
The macro tape is mildly risk-on (VIX 14, S&P near highs) which normally lifts a beta-1.62 cyclical like AA, but the lift is capped: 10y at 4.63% and a stretched market PE punish commodity names whose bull case rests on multi-year peak spreads. The active narrative is a late-stage cyclical with strong intensity but explicitly fragile durability and low cult - exactly the profile that cracks first when the aluminum-as-green-metal story loses a headline. At $49.98 versus a $27.42 DCF, the tape is carrying an 82% narrative premium that has no fan base to defend it. News flow is mixed-to-negative for the name specifically: a Bloomberg piece on Trump-base opposition to a flagship US aluminum plant undercuts the reshoring/industrial-policy leg of the bull case, while the standout earnings story in the space is Kaiser, not Alcoa - peer strength without AA participation is a subtle de-rating signal. Net: modest macro tailwind, meaningful narrative and news headwind, and high beta amplifies any risk-off flinch.
Verify before trusting this (4)
- Any aluminum price roll-over or China export data that would crack the supply-tightness leg of the bull story
- Sell-side revisions post-Kaiser print - if AA estimates do not follow peers up, that is a clear relative headwind
- Progress or setback on the Oklahoma plant approvals as a narrative test
- VIX break above 18 or curve inversion - would amplify the beta-1.62 downside sharply
Aluminum's demand story — grid buildout, EV lightweighting, packaging substitution — is real but slow-moving, and it does not change the fact that Alcoa's P&L is set by two prices it does not control. The durable world change that actually helps Alcoa is trade fragmentation: tariffs and security-of-supply policy bifurcate Western metal from Chinese metal and keep regional premia structurally wider than history, which is a persistent margin uplift for a producer with US and Canadian tonnes. Working against it: alumina refining capacity is being added outside China at exactly the moment the 2024-25 alumina squeeze normalizes, and high-cost European power keeps parts of the asset base structurally marginal. Net: a firmer floor under Western metal, a lower ceiling on alumina, and earnings power that holds rather than compounds.
Prediction unavailable. valuation-synthesis has no result for AA — the prediction needs its fair-value anchors.