Nomura Securities analyst Curt Woodworth bumped his price target on Alcoa (NYSE: AA) to $12.00 (from $8.00) following better-than-expected Q2 results but maintained a Neutral rating.

Woodworth commented, "We view Alcoa’s continued transformation from a commodity aluminum producer to a high margin downstream manufacturer positively, as we believe the shift will drive significant earnings growth over the next several years. Alcoa has accelerated downstream investment while at the same time rationalizing its upstream operations, with the company’s recent Firth Rixson acquisition coupled with its $125mm jet engine investments evidence of ongoing efforts to deepen its aerospace platform. We now expect EBITDA to grow 7% on average over the next two years and revise our 2015E EBITDA to $3bn from $2.6bn to reflect greater contribution from downstream operations, namely the Firth Rixson acquisition, as well as increased sustainability of elevated physical premiums."

The firm raised FY14E EPS from $0.35 to $0.53; FY15E EPS from $0.42 to $0.66.

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Shares of Alcoa closed at $14.85 yesterday.