Financial Review: Kaiser Aluminum Corporation (KALU) and Alcoa Corp. (AA)
Alcoa Corp. (NYSE: AA) and Kaiser Aluminum Corporation (NASDAQ:KALU) are both industrial products companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, analyst recommendations, institutional ownership, valuation, earnings, profitabiliy and risk.
Institutional & Insider Ownership
98.0% of Kaiser Aluminum Corporation shares are held by institutional investors. 2.8% of Kaiser Aluminum Corporation shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.
Kaiser Aluminum Corporation pays an annual dividend of $2.00 per share and has a dividend yield of 2.3%. Alcoa Corp. does not pay a dividend. Kaiser Aluminum Corporation pays out 35.3% of its earnings in the form of a dividend.
This table compares Alcoa Corp. and Kaiser Aluminum Corporation’s net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Kaiser Aluminum Corporation||7.55%||10.73%||6.06%|
Valuation & Earnings
This table compares Alcoa Corp. and Kaiser Aluminum Corporation’s gross revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||EBITDA||Earnings Per Share||Price/Earnings Ratio|
|Alcoa Corp.||$9.84 billion||0.56||$1.45 billion||N/A||N/A|
|Kaiser Aluminum Corporation||$1.34 billion||1.10||$230.90 million||$5.66||15.13|
Alcoa Corp. has higher revenue and earnings than Kaiser Aluminum Corporation.
This is a summary of recent ratings and recommmendations for Alcoa Corp. and Kaiser Aluminum Corporation, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Kaiser Aluminum Corporation||1||2||3||0||2.33|
Alcoa Corp. currently has a consensus price target of $36.25, indicating a potential upside of 20.83%. Kaiser Aluminum Corporation has a consensus price target of $91.67, indicating a potential upside of 7.02%. Given Alcoa Corp.’s stronger consensus rating and higher possible upside, analysts plainly believe Alcoa Corp. is more favorable than Kaiser Aluminum Corporation.
Kaiser Aluminum Corporation beats Alcoa Corp. on 7 of the 13 factors compared between the two stocks.
About Alcoa Corp.
Alcoa Corporation, formerly Alcoa Upstream Corporation, is engaged in the production of bauxite, alumina and aluminum of various cast and rolled products. The Company is engaged in the production and management of aluminum and alumina combined through its participation in various aspects of the industry, such as technology, mining, refining, smelting, and recycling. The Company’s segments include Bauxite, Alumina, Aluminum, Cast Products, Energy and Rolled Products. The Company’s Bauxite segment represents its global portfolio of bauxite mining assets. The Company’s Alumina segment represents its refining system across the world, and processes bauxite into alumina and sells it directly to internal and external smelter customers across the world. The Company’s Aluminum segment represents its smelter system across the world. Its Energy segment represents its portfolio of energy assets, with power production capacity of approximately 1,685 megawatts.
About Kaiser Aluminum Corporation
Kaiser Aluminum Corporation manufactures and sells semi-fabricated specialty aluminum mill products. The Company operates in the Fabricated Products segment. The Company’s Fabricated Products segment focuses on producing rolled, extruded and drawn aluminum products used principally for aerospace and defense, automotive and general engineering products that include consumer durables, electronics, electrical and machinery and equipment applications. The Company offers its products for various end market applications, such as aerospace and high strength (Aero/HS products); automotive (Automotive Extrusions); general engineering (GE products), and other industrial (Other products). The Company’s fabricated aluminum mill products include flat-rolled (plate and sheet), extruded (rod, bar, hollows and shapes), drawn (rod, bar, pipe and tube) and cast aluminum products.
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