NEW YORK (TheStreet) -- Shares of Alcoa Inc. (AA) are up 0.52% to $17.29 after the aerospace manufacturer said it signed a long-term contract to supply aluminum sheet and plate products to Boeing (BA) . The multiyear contract, valued at more than $1 billion, is the largest ever between the two companies.
The agreement makes Alcoa sole supplier to Boeing for wing skins on all of its metallic structure airplanes. Alcoa plate products, used in applications such as wing ribs, wing skins or other structural parts of the aircraft, will also be on every Boeing platform, including the 787 Dreamliner.
Also,, the agreement establishes a foundation for continued collaboration on new, high-strength and corrosion-resistant alloys, including aluminum-lithium that could be used for complex structural applications.
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."