NEW YORK (TheStreet) -- Shares of Alcoa (AA) - Get Alcoa Corp. Reportgot hammered following the company's announcement that it had struck a deal with Boeing (BA) - Get Boeing Company Report worth more than $1 billion.

Wall Street was not impressed. Alcoa's shares closed down almost 2$ Thursday and were down a further 1% Friday.

However, Alcoa remains a great long-term investment. At $17, shares are up 57% for the year to date, outpacing the 7.75% gain in the S&P 500, according to CNN Money. These shares, which are less than 3% away from a new 52-week high, should reach $20 in the next 18 to 24 months.

Already called the largest deal ever between the two companies, Alcoa will supply Boeing with aluminum sheet and plates to be used in Boeing jets. As Alcoa puts it, this deal "establishes a foundation for continued collaboration" on new alloys, including aluminum-lithium.

Dennis Muilenburg, Boeing's chief financial officer, said the deal with Alcoa was part of Boeing's broader "partnering for success." It's an initiative aimed to help Boeing secure better costs from its regular suppliers.

For Alcoa, which has always had ambitions of growing in the aerospace industry, this deal with Boeing makes sense, especially on the heels of the company's $3 billion acquisition of Firth Rixson, a U.K.-based maker of jet-engine components. Wall Street just hasn't had time to digest it yet.

The deal exposes Alcoa to opportunities in higher-margin products. Given the extent to which global aluminum pricing have been under pressure due to commoditization, entering the high-growth air space to supply with Boeing with alloy components will have long-term growth effects.

Wall Street is also discounting how Firth, the world’s largest supplier of seamless rings for aero-engines, can provide Alcoa an additional source of revenue with its rings and metal products business. Firth, which also has capabilities in specialized isothermal technology, uses no aluminum in its products, giving Alcoa a level of diversification that is unmatched by anyone in the industry.

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In other words, Alcoa is no longer just a play on aluminum. Aside from its move into the aerospace industry, the company quickly expanding into other types of metals like titanium and steel. The Alcoa investors know today will not the same company in a couple of years.

As a result, Alcoa is becoming less dependent on aluminum and becoming more diversified at a time when the aluminum environment is, in fact, improving. Part of the reason has to do with the uptick in global demand, which Alcoa projects will grow by 7%.

In the most recent quarter, Alcoa's aluminum business swung to a profit of $97 million from a $32 million loss. This occurred despite the company diligently cutting costs in that business. With automakers such as Ford (F) - Get Ford Motor Company Report  -- with its new aluminum-bodied F-150 -- using more aluminum in vehicles, demand should continue to improve, especially in the U.S.

Alcoa, which just became the sole supplier of wing skins for Boeing airplanes, has now established growth potential on land and in the air. Combined with Firth's projected Ebitda contribution of $350 million in the next two years, Alcoa remains one of the best long-term investments on the market.

At the time of publication, the author held no positions in any of the stocks mentioned, although positions may change at any time.

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This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

TheStreet Ratings team rates ALCOA INC as a Buy with a ratings score of B-. TheStreet Ratings Team has this to say about their recommendation:

"We rate ALCOA INC (AA) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, growth in earnings per share and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity." You can view the full analysis from the report here: AA Ratings Report