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Why Is Century (CENX) Down 15.8% Since Last Earnings Report?

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A month has gone by since the last earnings report for Century Aluminum (CENX - Free Report) . Shares have lost about 15.8% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Century due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.

Century Aluminum’s Q1 Earnings and Sales Lag Estimates

Century Aluminum reported net loss of $140 million or $1.55 per share in first-quarter 2021, wider than net loss of $2.7 million or 3 cents per share in the year-ago quarter. The bottom line in the reported quarter was affected by $87.4 million of exceptional items.

Barring one-time items, adjusted loss was 54 cents per share, wider than the Zacks Consensus Estimate of a loss of 32 cents.

Revenues and Shipments

The company generated net sales of $444 million in the first quarter, up around 5% year over year. The figure missed the Zacks Consensus Estimate of $458.8 million. Sales increased 14% sequentially on higher aluminum prices and regional premiums.

Shipments of primary aluminum were 195,697 tons, down around 4% year over year.

Financials

At the end of the quarter, the company had cash and cash equivalents of $26.3 million, down 82% year over year.

Net cash used in operating activities was $49.8 million for the quarter.

Outlook

Century Aluminum stated that it is seeing continued improvement in industry conditions, which reflects the pace and level of general manufacturing activity. The global primary aluminum market is in balance while global inventories continue to decline, the company noted. Century Aluminum also said that the availability of prompt metal units in its major markets remains constrained due to strong demand and limited global capacity additions.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -147.22% due to these changes.

VGM Scores

At this time, Century has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Century has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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