UBS initiated coverage on AA with a "sell" rating
The shares of aluminum stock Alcoa Corp (NYSE:AA) are sliding today, after UBS initiated coverage with a "sell" rating and $29 price target, though BMO threw in a price-target hike to $30 from $28. This attention comes ahead of the company's fourth-quarter earnings report, due out after the close tomorrow, Jan. 17.
At last glance, AA was down 3.8% at $28.88, and crossing below the $30 level, which provided support since mid December. The stock's 50-day moving average appears to be containing today's pullback, however. Since last January, AA is down 47.1%.
AA closed lower after its last four earnings reports, including an 8.6% drop this past October. Over the past two years, the stock has averaged a 6% next-day swing, regardless of direction, which is lower than the 10.5% move the options pits are pricing in this time around.
Today's note has UBS joining a mostly bearish brokerage bunch. Of the 14 in coverage, 10 carry a "sell" or worse rating on the stock.