Alcoa (AA):
 Some folks out there were probably expecting a bit of a disaster when these guys released last night. But it didn’t turn out that way.

Don’t get me wrong -- the results were hardly something for the record books, as it lost $0.26 excluding items. Its saving grace was that it was better than the $0.38 loss the Street had been looking for.

Some thoughts:

1. We can breathe a sigh of relief here. In fact, I suspect that’s what's going on in Europe in early trading. A horrific miss might have set a really bad tone for earnings season.

2. I continue to look at it as a longer-term play as opposed to a trade. I also believe people will want to see some green soon, so it really needs to get back in the black in 2010.

3. The shares could get a goose today, which is certainly more than the masses had hoped for.

Costco (COST):
 The store that sells paper towels and cooking oil by the metric ton was out with its June sales numbers. 

Its comp sales numbers were down a not-so-insignificant 6%.

My feelings:

1. It wasn’t a horrific number in that it seems consistent with what the Street had been looking for.

2. The trouble is that the comp result doesn’t convince me that I need to hop aboard right now. I’d rather be shopping for shares of Target (TGT), as I mentioned in a previous article.  

3. Regardless of these latest numbers, I still think the stock is pricey. It’s trading at about 18.6 times the current-year estimate right now, which is hardly thrilling.

4. I’d like to see several quarters of it beating expectations as this would probably enable it to get out of the lower end of its 52-week trading range.

Have a great day!