Why Is Alcoa Stock Trading Higher On Wednesday?

Alcoa (NYSE:AA) shares are up on Wednesday’as the company is further modernizing its approvals framework in Australia.

Details

Alcoa of Australia has reached an agreement with the Australian Federal Government to modernize its mining approvals under the Environment Protection and Biodiversity Conservation Act.

This initiative includes a Strategic Assessment of current and potential mining areas through to 2045, which aims to provide a comprehensive view of environmental impacts and enhance operational clarity.

The company will continue its operations at the Huntly and Willowdale mines while the assessment is conducted, supported by a National Interest Exemption.

The recent agreement with the Australian government to modernize its approvals framework is significant for Alcoa as it seeks to enhance its operational clarity and sustainability practices.

This move aligns with the company’s long-term strategy to maintain its position in the aluminum market while addressing environmental concerns.

Additionally, Alcoa will limit clearing to 800 hectares per year and increase rehabilitation efforts to 1,000 hectares annually by 2027, reflecting its commitment to environmental sustainability.

Alcoa of Australia maintains it complied with the EPBC Act but has agreed to pay $36 million (AUD 55 million) under enforceable undertakings related to acknowledged past land clearing.

Notably, the company will take an additional $19 million charge to previously reported fourth-quarter 2025 cost of goods sold ($13 million after tax, or $0.05 per share) to adjust environmental reserves tied to the enforceable undertakings, with the full $36 million (A$55 million) cash payment expected in 2026.

Technical Analysis

The stock is currently trading 4% below its 20-day simple moving average (SMA) but is 4% above its 50-day SMA, indicating a mixed short-term trend. Over the past 12 months, shares have increased 55.28%, and they are currently positioned closer to their 52-week highs than lows.

The RSI is at 46.63, which is considered neutral territory, while the MACD is below its signal line, indicating bearish pressure on the stock. The combination of neutral RSI and bearish MACD suggests mixed momentum.

• Key Resistance: $67.00
• Key Support: $55.50

Earnings & Analyst Outlook

Alcoa Corporation is slated to provide its next financial update on April 15, 2026.

• EPS Estimate: $1.19 (Down from $2.15)
• Revenue Estimate: $3.33 billion (Down from $3.37 billion)
• Valuation: P/E of 13.0x (Indicates value opportunity)

Analyst Consensus & Recent Actions: The stock carries a Buy Rating with an average price target of $48.54. Recent analyst moves include:

• Morgan Stanley: Downgraded to Equal-Weight (Raises Target to $64.00) (Jan. 27)
• Wells Fargo: Equal-Weight (Lowers Target to $64.00) (Jan. 23)
• Wells Fargo: Downgraded to Equal-Weight (Raises Target to $71.00) (Jan. 13)

Top ETF Exposure

• State Street SPDR S&P Metals & Mining ETF (NYSE:XME): 5.27% Weight
• SPDR S&P Metals & Mining ETF (NYSE:XME): 4.60% Weight
• First Trust Materials AlphaDEX Fund (NYSE:FXZ): 4.47% Weight

Significance: Because AA carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.

AA Price Action: Alcoa shares were up 5.18% at $60.44 at the time of publication on Wednesday.

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