UBS (NYSE:UBS) Sees Alcoa (NYSE:AA) Downstream Stronger

UBS (NYSE:UBS) maintains a "Neutral" rating on aluminum giant Alcoa (NYSE:AA), saying they see their downstream as strong.

"We note there were several adjustments that may or may not have been included in consensus numbers. Nevertheless, we believe these results are slightly better than expected mostly due better performance in the midstream and downstream businesses. AA’s Q2 cash flow from operations before working capital was lower at $179M, but AA continued to generate positive FCF after working capital."

UBS also increased Alcoa's earnings in the full year 2010, raising estimates from $0.30 to $0.50; for full year 2011, from $0.80 to $1.02; and for full year 2012, increasing from $1.52 to $1.71.

Alcoa closed the week at $12.89, rising $0.69 on Friday, or 5.66 percent. UBS has a price target of $13.25 on the, up from $12.