2:46 PM
Alcoa Q2 profit jumps on metal prices
Addison Ray
NEW YORK | Mon Jul 11, 2011 4:30pm EDT
NEW YORK (Reuters) - Alcoa Inc, the largest U.S. aluminum producer, posted a big jump in second-quarter profit partly due to soaring prices for aluminum and its raw material alumina.
Net earnings were $322 million, or 28 cents per share, compared with $136 million, or 13 cents per share in the same quarter of 2010.
Revenue rose 27 percent to $6.6 billion, topping the $6.32 billion expected by analysts.
Following are initial reactions of analysts and investors:
STEPHEN MASSOCCA, MANAGING DIRECTOR, WEDBUSH MORGAN, SAN FRANCISCO
"The initial reaction is that revenues are better than expected, but people are still going through the numbers. It's too early to draw any conclusions about the earnings.
"The revenue beat is the news here, but it's one data point so it's not conclusive. The other thing is Alcoa's CEO is talking about a strong second half and an improving outlook. They've seen growth in various markets, aerospace, automotives.
"The market is going to be more focused on macro concerns overnight. In a vacuum, this Alcoa news would be market moving, as the start to earnings season, but there are so many other issues that may drown it out tomorrow, based on what happens in Europe and negotiations in Washington."
BRIDGET FREAS, ANALYST AT MORNINGSTAR, CHICAGO
"The big story here is the beat on the revenue line. $6.6 billion -- that was certainly ahead of our expectations. Even though they've had a little more cost than expected during the quarter, volumes have improved significantly."
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