Following recent manufacturing-sector earnings reports, UBS Group AG analysts reviewed the industrial metals sector and identified two preferred aluminum stocks, with Alcoa remaining their top pick.
UBS expects approximately 3.0 million metric tons of Middle Eastern aluminum supply to return to the market, while Indonesian smelters continue to increase production. The bank forecasts global supply growth of approximately 5.0% in 2026 and 3.0% in 2027, compared with annual demand growth of around 2.5–3.0%.
These projections point to a less supportive supply-and-demand environment for the aluminum market over the next two to three years. Nevertheless, UBS continues to favour Alcoa because of its position as a major integrated producer and the possibility that aluminum prices will stabilize above the industry cost curve.
Alcoa published its second-quarter financial results last week. Revenue reached a quarterly record of $3.966 billion, up from $3.193 billion in the previous quarter and $3.018 billion in the same period of 2025. The result was slightly below analysts’ consensus estimate of approximately $3.99 billion.
Adjusted earnings per share amounted to $2.12, compared with $1.40 in the previous quarter and $0.39 a year earlier. However, the figure fell short of the market estimate of approximately $2.32. Diluted earnings per share calculated under GAAP reached $1.53, compared with $0.62 in the second quarter of 2025.
Alcoa continues to maintain a relatively modest dividend policy. On June 5, the company paid a quarterly cash dividend of $0.10 per share to shareholders of record as of May 19. At a share price near 44.00, this represents an annualized dividend yield of approximately 0.9%.
Support and Resistance Levels
On the daily chart, the stock is trading below the lower dynamic boundary of a broadening formation, whose wider boundaries are estimated at 87.00 and 54.00.
Technical indicators continue to provide a stable sell signal: the spread between the Alligator indicator’s EMA lines remains relatively wide, while the Awesome Oscillator histogram is forming declining bars in negative territory.
Resistance levels: 48.00, 57.40.
Support levels: 42.00, 32.70.
Alcoa Corp. Trading Scenarios and Stock Price Forecast
Short positions may be considered after the price declines and consolidates below 42.00, with a target at 32.70 and a stop-loss at 50.00. Implementation period: seven days or more.
Long positions may be considered after the price rises and consolidates above 48.00, with a target at 57.40 and a stop-loss below 42.00.
Scenario
| Timeframe | Weekly |
| Recommendation | SELL STOP |
| Entry Point | 42.00 |
| Take Profit | 32.70 |
| Stop Loss | 50.00 |
| Key Levels | 32.70, 42.00, 48.00, 57.40 |
Alternative Scenario
| Recommendation | BUY STOP |
| Entry Point | 48.00 |
| Take Profit | 57.40 |
| Stop Loss | 42.00 |
| Key Levels | 32.70, 42.00, 48.00, 57.40 |
