Earnings Preview Alcoa & How To Trade It

Alcoa

is set to report earnings tonight after the bell, and the whole world will be watching Alcoa, as the aluminum-maker is seen as a proxy for the global economy. Alcoa, which produces aluminum, is seen as a strong indicator for the global economy, as aluminum is used in many products, such as aircraft, housing products, Aluminum is incredibly energy intensive to make, and any move higher in natural gas prices could affect Alcoa's earnings and guidance going forward. At last check, shares of Alcoa were off 42 cents to $15.96, a loss of 2.56%‎. If Alcoa is able to surpass earnings estimates of 34 cents per share on $6.32 billion in sales, then names like Aluminum Corp. of China

, and to a lesser extent Rio Tinto

could see some sympathy moves higher. Revenues are expected to jump nearly 22% from last year, and the guidance is expected to come in at 34 cents per share on revenues of $6.33 billion. Currently, shares of Caterpillar trade at 10.5 times forward earnings, and sport a 0.7% dividend yield to boot. Alcoa, Inc. engages in the production and management of aluminum, fabricated aluminum, and alumina. The company operates in four segments: Alumina, Primary Metals, Flat-Rolled Products, and Engineered Products and Solutions.