.September 4, 2024 11:31 AM

Alcoa (NYSE:AA) shares rose over 2% today after Wolfe Research upgraded the company to Outperform with a $36 price target. The analysts noted Alcoa’s stake in Alumina Ltd as a key benefit, as alumina prices have surged 48% this year.

Higher alumina costs may support aluminum prices by steepening the global cost curve, potentially preventing the restart of 1.2 million tons of idled European smelters. Wolfe Research estimates spot LME prices to range from $2,425 to $2,450 per ton in the second half of the year.

Analysts also anticipate commodity price boosts from expected Federal Reserve rate cuts, copper substitution opportunities, and China’s capacity caps.