Alcoa Corp.

Overview

The United States has a diverse, highly developed and private-sector- led economy, which is the largest in the world in nominal GDP terms and is characterized by high levels of productivity, technological innovation, and competitiveness .Real gross domestic product (GDP) increased at an annual rate of 3.2 percent in the fourth quarter of 2023, according to the “second” estimate. In the third quarter, real GDP increased 4.9 percent. The increase in the fourth quarter primarily reflected increases in consumer spending, exports, as well as state and local government spending

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Aluminum Industry

The global aluminum market was valued at $148.1 billion in 2021, and is projected to reach $258.3 billion by 2031, growing at a CAGR of 5.82% from 2022 to 2031. Corporation, Aluminum Corporation of China Limited, China Hongqiao Group Ltd., Hindalco Industries, East Hope Group Company Limited, Emirates Global Aluminum PJSC, Norsk Hydro ASA, Rio Tinto Alcan Inc., United Company Rusal Plc., and Xinfa Group        Co.,   Ltd.

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Alcoa Corporation

The Alcoa Corporation is expected to register a CAGR of greater than 3% during the forecast period.

The construction activities worldwide are expected to drive the demand for aluminum from the building and construction industry during the forecast period. In 2023, Alcoa expects capital expenditures of approximately $600 related to sustaining capital projects and growth projects

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Conclusion

The stock is currently trading at a valuation that exceeds its actual earnings. Based on our analysis, the true valuation of the stock should be around $3 per share. This indicates that the current market price may be inflated relative to the company's earnings potential. It's important for investors to consider this discrepancy in valuation when making investment decisions.