Iconic 140-Year-Old Company Is a Sneaky AI Play You May Have Missed

When you think of AI, which stocks come to mind?

Nvidia  (NVDA) , Advanced Micro Devices  (AMD) , and Broadcom  (AVGO) , all AI chip manufacturers, are among the more obvious names. Microsoft  (MSFT) , Amazon  (AMZN) , and Alphabet  (GOOGL)  integrate AI throughout their software products and cloud services. Palantir  (PLTR)  provides software platforms that analyze data using AI.

However, there are less obvious ways to ride the AI wave. 

Here is one name that most investors don’t typically associate with AI, despite the company being an indirect player in that space.

A 137-Year-Old AI Play?

The Aluminum Corporation of America was founded in 1888 in Pittsburgh, PA. Today, Alcoa’s  (AA)  website describes it as the world’s largest third-party producer of alumina, a key component in the production of aluminum metal.

Generally, we don’t think of companies that were founded in the 1800’s as AI plays. Like most companies today, Alcoa is using AI to enhance its own operations via automation and efficiency, but that's not why this stock has potential. 

More significant is the skyrocketing need for AI infrastructure, particularly data centers. Earlier this month, Morgan Stanley  (MS)  analyst Carlos de Alba reiterated his buy rating for Alcoa, as well as global copper producer Freeport-McMoRan  (FCX) . Both companies stand to benefit from growth in AI infrastructure.

Alba believes that Alcoa has several roles to play within that area: one as a provider of the material to help build AI data centers, and another as a potential provider of future locations for data centers. According to Alba, Alcoa controls facilities that are ripe for repurposing into AI infrastructure.

Meanwhile, aluminum futures have been on a tear. Speaking earlier this week on Alcoa’s post-earnings conference call, CEO William Oplinger said, “Aluminium prices have finally risen to a level where it covers the full tariff cost.”

Alcoa’s chart has a similar look. While the stock has underperformed the broader market, gaining just 5.6% year to date, Alcoa shares have climbed a whopping 27.3% over the past month. 

On Wednesday, Alcoa soared to a 12.6% gain after reporting third-quarter earnings, which came in better than expected. Revenues were slightly below analysts’ estimates, but that didn’t stop investors from pushing the stock to its highest closing price so far this year. 

Perhaps investors are looking beyond Alcoa’s current earnings and revenue, and factoring in the stock’s potential as a tertiary AI play. 

At the time of publication, Ponsi was long AMD, AVGO, NVDA, FCX, PLTR and AA.