Shares of Alcoa Inc (AA.N) fell over 3 percent on Wednesday after the aluminum company reported a quarterly net loss and one analyst cut its stock target price because of continued weak aluminum prices.
In morning trading on the New York Stock Exchange, Alcoa shares were down 3.2 percent at $8.84.
Analyst Curt Woodworth of Nomura lowered Alcoa's target price to $9 from $12 because of "continued weakness in aluminum prices and deepening structural challenges."
He noted the London Metal Exchange (LME) aluminum price has been under significant pressure in 2012 owing to generally weak Western demand.
"Unfortunately for Alcoa, they operate among the highest cost smelters in the Western World and thus stand most at risk from a volume perspective as the industry rationalizes high cost capacity," Woodworth wrote in a research note.
Tony Rizzuto, of Dahlman Rose & Co maintained his "hold" rating on Alcoa's stock because he saw "no catalyst for a meaningful move higher in LME prices."
"The company's upstream alumina and primary aluminum businesses continue to struggle with a difficult operating environment," he wrote in a note.
"Though management is taking appropriate steps to address upstream issues (curtailing high-cost capacity, focusing on efficiency gains, etc), the company's position on the cost curve for these businesses remains an obstacle," Rizzuto wrote.
On Tuesday, Alcoa reported a net third-quarter loss of $143 million, or 13 cents per share compared with a profit of $172 million, or 15 cents per share, in the same quarter last year.
Excluding charges, its showed an adjusted profit of 3 cents per share, which beat Wall Street analyst estimates.
(Reporting By Steve James; Editing by Theodore d'Afflisio)