Alcoa's Alumina Segment Growth Picks Up: More Upside to Come?

Alcoa Corporation AA is benefiting from persistent strength in its Alumina segment, supported by strong performances across its assets and favorable prices. The segment is benefiting from growth in output at the Australian refineries. In fourth-quarter 2025, production from the Alumina segment increased 1% sequentially to 2.48 million metric tons. The third-party shipments of alumina were also up 5% sequentially in the quarter.

AA remains focused on acquiring new assets to boost its organic growth. For instance, in August 2024, the company acquired Alumina Limited, which enhanced its position as one of the world’s largest bauxite and alumina producers. The buyout will provide Alcoa with long-term value creation due to greater financial and operational flexibility.

Also, the company’s joint venture with IGNIS EQT (entered in March 2025) is likely to resume and enhance the production capacity of its San Ciprian site. AA anticipates the restart of the site to be completed by mid-2026, which augurs well.

Driven by strength across its businesses, Alcoa provided a healthy outlook for the Alumina segment’s production and shipment volume. For 2026, AA expects alumina production to be in the range of 9.7-9.9 million tonnes, while shipments are projected to be 11.8-12.0 million tonnes.

Segment Snapshot of AA's Peers

Constellium SE CSTM is benefiting from strength in the Packaging & Automotive Rolled Products segment. The segment’s shipments increased 6% year over year to 1,027,000 metric tons in 2025, buoyed by a robust demand environment. Revenues from the segment increased 21% to $4.2 billion, supported by higher metal prices.

Ryerson Holding Corporation RYI is witnessing strong growth in the Aluminum segment. The segment’s shipments were relatively flat year over year at 143,000 tons in the first three quarters of 2025. Revenues from the segment were up 7.7% to $868 million, driven by higher metal prices and strong shipments.

AA’s Price Performance, Valuation and Estimates

Shares of Alcoa have surged 68% in the past three months compared with the industry’s growth of 57.3%.

From a valuation standpoint, AA is trading at a forward price-to-earnings ratio of 11.61X, above the industry’s average of 11.44X. Alcoa carries a Value Score of A.

The Zacks Consensus Estimate for AA’s 2026 earnings has increased 20.8% over the past 60 days.

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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