Update shared on08 Oct 2025
Fair value Increased 7.47%Analysts have raised their price target for Alcoa from $34.09 to $36.64. They cite improved forecast profit margins and lower expected future price-to-earnings ratios as key factors in their updated outlook.
What's in the News
- Alcoa will permanently close its Kwinana alumina refinery in Western Australia, following a curtailment of production in June 2024. Multiple factors such as facility age, operating costs, market conditions, and bauxite grade challenges contributed to this decision. (Key Developments)
- The closure of the Kwinana refinery will reduce Alcoa's global consolidated refining capacity to 11.7 million metric tons. Preparations are underway for new economic development opportunities at the site, in collaboration with the Western Australian State Government. (Key Developments)
- The Kwinana refinery currently employs around 220 people. This number will decrease during 2026 as closure progresses, with some staff remaining for site redevelopment. Associated severance costs were previously recorded in early 2024. (Key Developments)
- Alcoa's port and rail facilities at Kwinana will continue to operate, as will other major operations in Western Australia and Victoria. (Key Developments)
- Alcoa held its Analyst/Investor Day, providing updates to investors and analysts on company performance and strategy. (Key Developments)
Valuation Changes
- Consensus Analyst Price Target has increased from $34.09 to $36.64, reflecting a higher valuation outlook.
- Discount Rate has risen slightly from 8.05% to 8.15%, suggesting a marginal adjustment in risk assessment.
- Revenue Growth projections are slightly lower, moving from 1.31% to 1.25% year-over-year.
- Net Profit Margin is expected to improve significantly, climbing from 4.69% to 7.35%.
- Future P/E Ratio has fallen notably from 18.0x to 12.4x, indicating lower anticipated earnings multiples.
Disclaimer
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