Alcoa Inc (NYSE:AA) got a boost Monday when Deutsche Bank analyst Jorge Beristain upgraded the stock from Sell to Hold. Beristain also raised the price target from $7.50 to $10. The research firm said the increase in its price target reflects higher aluminum prices for the foreseeable future. However, downside risk still persists.

Alcoa Inc (AA)
Alcoa Inc (AA)

Alcoa’s Q1 revenue likely to decline 5% YoY

Deutsche Bank’s upgrade comes a day before Alcoa Inc (NYSE:AA) releases its first quarter earnings. The Pittsburgh-based aluminum producer will report its Q1 earnings on April 8 after the bell. Analysts expect the company to report 5 cents a share in Q1 earnings and $5.59 billion in revenues. Alcoa had earned 11 cents on revenues of $5.83 billion in the corresponding quarter last year.

Notably, the consensus estimate has increased over the past month from 4 cents. In a bullish sign for the company, six analysts have raised their Q1 earnings forecasts. For the full year 2014, Wall Street expects Alcoa to post $23.05 billion in revenues and 37 cents a share in earnings. Over the past four quarters, the 125-year old company has witnessed a YOY revenue decline of 3%.

Alcoa plans to invest in Brazil

Despite being kicked out of the Dow Jones Industrial Average and losing $2.3 billion in 2013 due to falling aluminum prices, Alcoa Inc (NYSE:AA) shares have gained more than 51% over the past 12 months. Currently, 8.1% of its shares are sold short. Last week, Alcoa announced that it will invest $40 million in Brazil to ramp up production of aluminum foil for packaging. The demand for specialty food and beverage packaging in Brazil is growing rapidly.

Besides Deutsche Bank, many other analysts have also upgraded Alcoa Inc (NYSE:AA) over the past few weeks. Cowen & Company raised its price target on the stock from $10 to $11 in a research note on April 2. On March 27, Macquarie analysts upgraded the stock from Underperform to Neutral, and raised their price target from $5 to $10.

Alcoa Inc (NYSE:AA) shares were down 1.19% to $12.48 at 12:03 PM EDT on Monday.