Why Century Aluminum Stock Soared Higher Today

Core Insights - Century Aluminum reported Q3 earnings nearly double Wall Street's expectations, with a profit of $0.56 per share and sales of $632.2 million, compared to analyst forecasts of $0.30 per share and $628.1 million in sales [1][8] - Year-over-year sales growth was 17.3%, but GAAP earnings per share declined over 67% to $0.15 from $0.46 a year ago [3][4] - The stock price increased by 12% following the earnings report, but the company is viewed as having a high price-to-earnings ratio of over 36x, raising concerns about valuation [1][5] Financial Performance - Q3 sales were $632.2 million, a 17.3% increase year-over-year, but only a 0.6% increase sequentially from Q2 [3][4] - The decline in tons of aluminum shipped was 7.6%, despite the increase in earnings [4] - The adjusted earnings per share of $0.56 contrasts sharply with the GAAP earnings of $0.15, indicating a significant year-over-year decline [3][8] Investment Considerations - The current stock price of $32 is considered expensive given the net profit of only $0.87 per share over the past year [5][6] - Future earnings targets set by Wall Street are $1.56 per share this year and $3.10 per share next year, which could make the stock appear cheaper if achieved [5] - Analysts from The Motley Fool Stock Advisor have identified other stocks as better investment opportunities, suggesting caution for potential investors in Century Aluminum [9]