Alcoa Shares Near 52-Week High As Earnings Await: Can the Rally Continue?

Alcoa shares (ASX: AAI) are fresh from 52 week highs ahead of this week’s earnings report, with the company set to deliver first-quarter 2026 numbers on April 16 (US hours). The share price has been strongly bullish leading in, with a 28% gain YTD, and a mighty 162% gain over the past 12 months.

Markets are expecting a solid quarter from Alcoa, driven by sustained aluminum prices and operational improvements. While EPS and revenue for Q1 are expected to have narrowed to $1.51 and $3.27B respectively, expectations for the FY are for a 12.9% sales growth rate, and a 70% rise in EPS to $6.41.

Looking at recent quarter’s for clues, Alcoa’s fourth-quarter 2025 results, released earlier this year, set a high bar. Revenue reached $3.45 billion, a 15% sequential increase attributed to higher aluminium prices and increased shipment volumes. Adjusted earnings per share (EPS) came in at $1.26, exceeding analyst expectations of $1.01. Adjusted EBITDA rose significantly to $546 million from $270 million in the prior quarter.

Operationally, Alcoa has been performing well. In Q4 2025, alumina production increased by 1% sequentially to 2.48 million metric tons, while aluminium production rose by 4% to 604,000 metric tons. The progress in restarting the San Ciprian smelter in Spain was a key driver. The company also reported record annual production at several smelters and a refinery.

Looking ahead, Alcoa has provided production guidance for 2026. The company expects alumina production to be between 9.7 and 9.9 million metric tons, with shipments between 11.8 and 12.0 million metric tons. Aluminium production is anticipated to range from 2.4 to 2.6 million metric tons, with shipments between 2.6 and 2.8 million metric tons. However, the company has cautioned about sequential unfavorable impacts on first-quarter 2026 Alumina Segment Adjusted EBITDA due to maintenance cycles, lower shipments, and higher production costs linked to the San Ciprian smelter restart. The company’s strategic initiatives, including the ELYSIS technology, are also garnering attention. The successful start of the first 450 kiloampere (kA) inert anode cell at Rio Tinto’s Alma smelter is a positive sign for future innovation and potential cost reductions.

However, investors should be mindful of the potential challenges highlighted by the company. The expected sequential decline in Alumina Segment Adjusted EBITDA in the first quarter could weigh on earnings. The successful management of the San Ciprian smelter restart and the ability to navigate maintenance cycles will be crucial.

Analysts will be closely scrutinizing Alcoa’s first-quarter earnings report for several key indicators. These include the company’s ability to maintain aluminium production levels despite the planned maintenance, the actual impact of the San Ciprian smelter restart on costs, and any updates on the progress of strategic initiatives such as ELYSIS. Any positive surprises could fuel further gains in the stock price.

The recent strength in Alcoa’s stock price reflects investor confidence in the company’s ability to capitalize on favorable aluminum market conditions and execute its operational strategy. However, the first-quarter earnings report will be a critical test. Ultimately, Alcoa’s ability to manage costs, maintain production levels, and continue to innovate will determine whether the stock can sustain its upward momentum and continue to set new highs.