The world’s most profitable franchise

Base Metals Investing

Back in March 2001, at the start of the commodities supercycle, Pittsburg-based Alcoa (NYSE:AA) was the world’s biggest mining name, by market value, at about USD 30bn; BHP Billiton (NYSE:BHP), the world’s biggest diversified resources stock, was No 2, then worth about USD 28bn.

Today, Alcoa, with a value of USD 13.7bn, languishes at No 38 among global miners; BHP Billiton is easily at the top, with a gain of nearly USD 200bn in market value, now at USD 218.7bn. This ranks the stock as one of the world’s most valuable entities of any kind. Investors who bought Alcoa stock missed the boat, but why?

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