Capital Ideas added additional shares of Alcoa Incorporated (NYSE: AA) to its Macro Plus Income model last week. Today, analysts at Deutsche Bank raised AA from a hold to a buy. Investors drove AA’s stock price up from its December 31st closing price of $15.39 to $15.80, according to Yahoo Finance.
The reason for the upgrade? According to Seeking Alpha’s Market Currents on Monday, January 3, Deutsche Bank believes that AA has, “turned the corner” operationally and that the expected increase in the price of aluminum may helped it lessen its losses during the first quarter of 2010.
Capital Ideas also added a new position to the model, Arm Holdings Public Limited Company (NASDAQ: ARMH). ARMH designs the chips for many smartphones and tablet PCs. It also designs RISC processors, which help a PC’s performance by giving it a simplified set of instructions to execute. On December 27th, Microsoft announced that it would be using ARMH’s chips with the Windows operating system for its new set of tablet PCs. Before the announcement, there had already been some speculation that Microsoft (NASDAQ: MSFT) and ARMH had reached such an agreement, which could negatively impact Intel Corp (NASDAQ: INTC). Since Apple Inc (NASDAQ: AAPL) also uses ARMH’s technology, this could be another bullish sign for ARMH if Goldman Sachs analysts are correct that tablet PC sales will replace about one third of overall PC sales.
