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Research Alert: CFRA Maintains Hold Recommendation On Shares Of Alcoa Corporation

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We increase our 12-month target by $7 to $75, assuming an EV/EBITDA of 6.5x our 2027 EBITDA estimate, a discount to AA's three-year average forward EV/EBITDA of 6.7x, warranted by the Section 232 tariffs, a headwind for AA's cost basis. We raise our 2026 EPS estimate by $2.97 to $7.78 and our 2027 EPS estimate by $0.57 to $6.12. AA benefits from a favorable aluminum supply-demand backdrop stemming from the Middle East conflict, which has taken approximately 2.5 million metric tons of annual smelting capacity offline and pushed LME aluminum prices above $3,600/ton. AA's strategic advantages include minimal spot electricity exposure (less than 1%) and growing demand for value-added products from customers seeking to replace Middle East supply. However, the alumina segment faces margin pressure from weak API pricing and elevated energy costs. With $1.4 billion in cash and debt reduction underway, AA is well positioned to benefit from sustained tight aluminum markets while navigating alumina headwinds.

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