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Cleveland-Cliffs Is Blazing Much Higher, When To Get Out
Oct. 25, 2021 12:50 PM ETCleveland-Cliffs Inc. (CLF)73 Comments23 Likes
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Summary
We have been bullish on the stock in the teens.
Amazing increases in steel prices have led to a massive jump in revenues.
The company has taken steps to improve shareholder value and expand its business.
With little signs of abatement, the stock is still cheap despite rising 30% from where we got behind it, and the stock has much more upside.
Initial target of $7.00 in 2022 EPS should the status quo remain, but we offer an exit strategy.
This idea was discussed in more depth with members of my private investing community, BAD BEAT Investing. Learn More »
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maki_shmaki/iStock via Getty Images
Cleveland-Cliffs (CLF) is a favorite among our traders. We have been pushing buys on our membership every time the stock touches the teens. We have encouraged SOME profit-taking in the mid $20s but right now we see the stock as being set up to move much higher. It may not, and frankly will not go up every single day, but this one is set to rise significantly in our opinion.
Long-time followers of this stock will remember the storied and troubled history of the company. We will not go into heavy detail but we believe the key strategic shift was deciding to move into steel production and not just iron ore. Fast forward to recent history and we are in an inflationary environment, with the potential for a major infrastructure bill, and projects popping up globally. For the most part, this has significantly driven up the price of steel. While there have been some shenanigans with China and their demand for steel sourcing and production curbs, the price of steel has remained pretty strong. And we think it is going higher.
We believe traders should start to shave some winnings (about 10% of your position) in the mid- to high-$20s and every 10% after that. With price targets mostly in the $30s, this is a good strategy. Be warned, because this is a high beta stock, it is likely the stock could fall back to $20-$22 before running higher. Just the nature of the market and the stock. But there is a lot to like here, as evidenced by the just reported earnings.
So just how good is it for CLF right now? Well, they went from about $2 billion annual revenues in 2019 to expected revenues of $21 billion in 2021. Period. End of article. The word 'wow' is tossed around a lot, but it is appropriate here. That is impressive. Further profitability continues to increase dramatically. Now at some point, perhaps in late 2022, steel prices will start to correct, so the good times will not last forever. But CLF has taken advantage of its windfall and done some wise things, including retiring all preferred shares which were equivalent to buying back 10% of the float. There was some debate among our traders about how much it actually cost the company to retire those preferreds, but having them off the liabilities and boosting common shareholder value is winning.
Further putting the strength of the company on display is the year-over-year comparisons for Q3. Keep in mind, we expect similar strength for Q4 2021 and for Q1 2022. We mentioned 2019 vs 2021 revenue annually, but just in Q3 year-over-year, we saw a massive jump in revenues to $6.0 billion, compared to the Q3 2020 revenues of $1.6 billion. That's a 265% increase. So you say you want to see profits rise too? Well in Q3 net income hit $1.3 billion, or $2.33 per share. What about past earnings? A year ago, Cliffs recorded net income of $2 million. That is "million," with an "m." How about year-to-date? The strength shows here as well. For the first nine months of 2021, Cliffs has revenues of $15.1 billion and net income of $2.1 billion, or $3.69 per diluted share. In the first nine months of 2020, we saw revenue of $3.1 billion and a net loss of $155 million, or a loss of $0.51 per diluted share.
From a valuation perspective, things are almost laughable. Trading at a little over 5X trailing earnings and about 3.5X FWD EPS. This was one of the main reasons we got behind the stock in our service and our members are now thinking about an exit strategy (which we suggested in the opening). The stock is 3X cash flow, with price to sales at 0.5X. These are tremendous metrics.
Now it does not just matter where a stock has been, but where it is going. The same can be said of company performance. Obviously, management has made strategic decisions such as focusing more on steel in the past, but much of the performance is driven by the price of the commodity. Right now, we see no signs of steel prices abating meaningfully in the near term. That means you need to be buying a stock like CLF. Have you missed the boat? Not entirely. It may pull back. You could buy some now and add more on a drop. You could also sell puts to define entry. There are many options to choose from here no pun intended.
As we look ahead, one line from the CEO Lourenco Goncalves stood out in his commentary on the company's outlook:
"Differently from other steel companies more exposed to spot prices, we believe that our average sales price next year should be higher than in 2021"
So whereas some competitors may see a leveling off or even a decline management here sees their average sale price rising in 2022. What is more, the company not only used cash flow to reduce the float (the preferred share retirement) but also to make an acquisition which should be closing soon. They are acquiring the Ferrous Processing and Trading Company, a top prime scrap processor in the U.S. This should reduce coke use and costs and allow for more use of prime scrap. It is a win for the production side of the equation. This is key when we look at the percentage breakdown of products. In Q3 the total steel product volume of 4.2 million net tons consisted of 32% hot-rolled, 31% coated, 18% cold-rolled, 6% plate, 4% stainless and electrical, and 9% of other products.
For Q4 we are looking for $2.75 in EPS assuming comparable volumes to Q3 and steel prices that are about where they are now. While it is early, we believe that if steel prices simply hold firm expenses as a percent of sales hold about where they are now, with no catalysts either positive or negative for pricing or costs, our initial look for 2022 is EPS of $7.00. Again, this will all depend on steel prices. If they start to roll over in early or mid-2022 then EPS will likely be less than this. However, if they hold firm, or fluctuate within just a 10% margin of error then we can easily see the $7.00 mark being attained. If this is the case of course, then we are at our 3.5X FWD EPS expectation, and that is a screaming buy in our view.
Don't believe it.
Elio Motors Returns From the Dead With 3-Wheeled Elio-E EV
https://www.motortrend.com/news/elio-motors-e-electric-vehicle/
Cleveland-Cliffs Is Turning Heads after Latest Results
Source: TipRanks
Cleveland-Cliffs (CLF) got on the investor radar last week, after reporting record third-quarter 2021 results. I'm bullish on CLF. (See Insiders’ Hot Stocks on TipRanks) The iron and mining producer reported a record quarterly revenue of $6 billion, up from $1.6 billion from the corresponding prior-year quarter. Net income came in at $1.3 billion, or $2.33 per diluted share, up from $2 million in the prior quarter. Adjusted EBITDA came in at $1.9 billion, up from $126 million in the third quarter of 2020. That's a remarkable turnaround in such a short time, thanks to the industry turnaround and the company’s business model.
https://www.tipranks.com/news/article/cleveland-cliffs-is-turning-heads-after-latest-results?utm_source=advfn.com&utm_medium=referral
$100 pps coming
Elio Motors promised 1,500 jobs at an old GM plant in Louisiana. But, ‘the intent had no basis in reality’
Key Players in This Report Include,
Baked Bros (United States), Bhang Corporation (United States), Cannabis Energy Drink (Netherlands), Canopy Growth Corporation (Canada), Dixie Brands Inc (United States), HEINEKEN Company (Netherlands), KANEH CO (United States), KIVA CONFECTIONS (United States), Kaya Holdings, Inc. (United States), Koios Beverage Corp. (Canada), LOL Edibles (United States), Lord Jones (United States)
So funny. "KEY PLAYERS"
https://www.openpr.com/news/2437290/cannabis-infused-edible-products-market-is-booming-worldwide
What a joke. Key SCAMMERS. IMO
Cleveland-Cliffs Stock Rises. But Not Because It Beat Earnings.
By
Al Root
Oct. 22, 2021 8:04 am ET
Spot prices for hot rolled coil have averaged about $1,500 a ton so far in 2021.
Ina Fassbender/AFP via Getty Images
Stock in steelmaker Cleveland-Cliffs was rising after the company reported better-than-expected third-quarter numbers. Earnings, however, aren’t what investors will focus on. Cliffs’ outlook for steel pricing was encouraging.
Cleveland-Cliffs (ticker: CLF) stock rose about 4.4% in premarket trading. S&P 500 and Dow Jones Industrial Average futures were up about 0.1% and 0.2%, respectively.
In the third quarter, Cliffs earned $2.33 a share from $6 billion in sales. Wall Street was looking for $2.26 a share from $5.6 billion in sales.
Earnings “beats” are good for stocks, but the prospect for higher earnings in 2022 is even a bigger deal for investors.
“The Cleveland-Cliffs business model is based on a significant amount of contract sales,” said CEO Lourenco Goncalves in the company’s news release. “Differently from other steel companies more exposed to spot prices, we believe that our average sales price next year should be higher than in 2021.”
Cliffs’ selling price averaged $1,334 a ton in the third quarter, up from $1,000 a ton in the third quarter in 2020. Year to date, Cliffs’ selling prices have averaged $1,122 a ton, up from $1,011 in 2020.
Contracted steel prices tend to lag behind when spot prices are going up and fall slower when spot prices are going down. Spot prices for hot rolled coil—a key benchmark—have averaged about $1,500 a ton so far in 2021, more than Cliffs’ average selling price. But spot prices averaged about $525 a ton in 2020 through the first nine months of the year when Cliffs’ prices averaged $1,000 a ton.
Cliffs sells a mix of products, not just hot rolled coil, so comparing hot roll prices to any company’s average selling prices is just a guide.
Cliffs has shipped about 12.5 million tons of steel so far in 2021.
Higher prices for commodity producers usually lead to higher earnings. Right now, Wall Street is projecting a drop. Analysts project $6.25 in per-share earnings for 2021 and $4.03 in per-share earnings in 2022.
Benchmark steel prices are up about 200% year over year, but gains have flattened, impacting stocks. Coming into Friday, Cliffs stock was up about 45% year to date, but shares haven’t moved for about three months.
Cleveland-Cliffs Reports Record Third-Quarter 2021 Results
Source: Business Wire
Record quarterly revenue of $6.0 billion
Record quarterly net income of $1.3 billion
Record quarterly adjusted EBITDA1 of $1.9 billion
Cleveland-Cliffs Inc. (NYSE: CLF) today reported third-quarter results for the period ended September 30, 2021.
Third-quarter 2021 consolidated revenues were $6.0 billion, compared to the prior-year third-quarter revenues of $1.6 billion.
For the third quarter of 2021, the Company recorded net income of $1.3 billion, or $2.33 per diluted share. In the prior-year third quarter, the Company recorded net income of $2 million.
For the first nine months of 2021, the Company recorded revenues of $15.1 billion and net income of $2.1 billion, or $3.69 per diluted share. In the first nine months of 2020, the Company recorded revenues of $3.1 billion and a net loss of $155 million, or a loss of $0.51 per diluted share.
Third-quarter 2021 adjusted EBITDA1 was $1.9 billion, compared to adjusted EBITDA1 of $126 million in the third quarter of 2020.
(In Millions)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021
2020
2021
2020
Adjusted EBITDA1
Steelmaking
$
1,969
$
127
$
3,901
$
117
Other Businesses
6
18
25
22
Corporate and Eliminations
(42
)
(19
)
(120
)
(72
)
Total Adjusted EBITDA1
$
1,933
$
126
$
3,806
$
67
Lourenco Goncalves, Cliffs' Chairman, President, and CEO said: “In a short period of less than two years, we went from $2 billion annual revenues in 2019 to expected revenues of $21 billion in 2021. Also, the $1.9 billion of Q3 adjusted EBITDA we have just reported is equivalent to half of our year-to-date adjusted EBITDA of $3.8 billion, showing that our profitability continues to increase, as we continue to implement our way of doing business, and take advantage of - and extract synergies from - our modern, efficient and unique footprint.”
Mr. Goncalves continued: "Our record free cash flow generated this quarter was used to retire the entirety of our outstanding preferred shares, equating to a 10% share buyback, a meaningful reduction in share count to the benefit of our shareholders. This month, we agreed to acquire Ferrous Processing and Trading Company, the leading prime scrap processor in the United States. The integration of FPT into our Cleveland-Cliffs footprint as a premier flat-rolled steel producer should allow us to utilize more prime scrap in our BOFs, further reducing both our utilization of coke and our carbon emissions. We are looking forward to closing this acquisition in the fourth quarter and capturing more value from our scrap right away. This is real growth; profitable growth; environmentally friendly growth.”
Mr. Goncalves concluded: “The Cleveland-Cliffs business model is based on a significant amount of contract sales. We have already concluded the renewal of several annual fixed price sales contracts with a significant number of our most important customers, and we are pleased with the successful results of these negotiations. Differently from other steel companies more exposed to spot prices, we believe that our average sales price next year should be higher than in 2021, allowing us to continue to grow our already strong profitability and to further strengthen our balance sheet."
Steelmaking
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021
2020
2021
2020
External Sales Volumes
Steel Products (net tons)
4,153
1,115
12,502
1,926
Operating Results - In Millions
Revenues
$
5,869
$
1,506
$
14,710
$
2,866
Cost of goods sold
(4,098
)
(1,405
)
(11,472
)
(2,882
)
Selling Price - Per Net Ton
Average net selling price per net ton of steel products
$
1,334
$
1,000
$
1,122
$
1,011
Third-quarter 2021 steel product volume of 4.2 million net tons consisted of 32% hot-rolled, 31% coated, 18% cold-rolled, 6% plate, 4% stainless and electrical, and 9% other, including slabs and rail.
Steelmaking revenues of $5.9 billion included $2.5 billion, or 42%, of sales to the distributors and converters market; $1.6 billion, or 27%, of sales to the infrastructure and manufacturing market; $1.1 billion, or 20%, of sales to the automotive market; and $670 million, or 11%, of sales to steel producers.
Third-quarter 2021 Steelmaking cost of goods sold included depreciation, depletion, and amortization of $229 million and amortization of inventory step-up of $11 million. Steelmaking Segment adjusted EBITDA of $2.0 billion included $66 million of SG&A expense.
Liquidity
As of October 19, 2021, the Company had total liquidity of approximately $2.2 billion.
Conference Call Information
Cleveland-Cliffs Inc. will host a conference call this morning, October 22, 2021, at 10 a.m. ET. The call will be broadcast live and archived on Cliffs' website: www.clevelandcliffs.com.
About Cleveland-Cliffs Inc.
Cleveland-Cliffs is the largest flat-rolled steel producer in North America. Founded in 1847 as a mine operator, Cliffs also is the largest manufacturer of iron ore pellets in North America. The Company is vertically integrated from mined raw materials and direct reduced iron to primary steelmaking and downstream finishing, stamping, tooling, and tubing. The Company serves a diverse range of markets due to its comprehensive offering of flat-rolled steel products and is the largest supplier of steel to the automotive industry in North America. Headquartered in Cleveland, Ohio, Cleveland-Cliffs employs approximately 25,000 people across its mining, steel and downstream manufacturing operations in the United States and Canada.
Forward-Looking Statements
This release contains statements that constitute "forward-looking statements" within the meaning of the federal securities laws. All statements other than historical facts, including, without limitation, statements regarding our current expectations, estimates and projections about our industry or our businesses, are forward-looking statements. We caution investors that any forward-looking statements are subject to risks and uncertainties that may cause actual results and future trends to differ materially from those matters expressed in or implied by such forward-looking statements. Investors are cautioned not to place undue reliance on forward-looking statements. Among the risks and uncertainties that could cause actual results to differ from those described in forward-looking statements are the following: our ability to successfully complete the acquisition (the "FPT Acquisition") of Ferrous Processing and Trading Company ("FPT"); disruptions to our operations relating to the COVID-19 pandemic, including the heightened risk that a significant portion of our workforce or on-site contractors may suffer illness or otherwise be unable to perform their ordinary work functions; continued volatility of steel and iron ore market prices, which directly and indirectly impact the prices of the products that we sell to our customers; uncertainties associated with the highly competitive and cyclical steel industry and our reliance on the demand for steel from the automotive industry, which has been experiencing a trend toward light weighting and supply chain disruptions, such as the microchip shortage, that could result in lower steel volumes being consumed; potential weaknesses and uncertainties in global economic conditions, excess global steelmaking capacity, oversupply of iron ore, prevalence of steel imports and reduced market demand, including as a result of the COVID-19 pandemic; severe financial hardship, bankruptcy, temporary or permanent shutdowns or operational challenges, due to the COVID-19 pandemic or otherwise, of one or more of our major customers, including customers in the automotive market, key suppliers or contractors, which, among other adverse effects, could lead to reduced demand for our products, increased difficulty collecting receivables, and customers and/or suppliers asserting force majeure or other reasons for not performing their contractual obligations to us; our ability to reduce our indebtedness or return capital to shareholders within the expected timeframes or at all, depending on market and other conditions; risks related to U.S. government actions with respect to Section 232 of the Trade Expansion Act (as amended by the Trade Act of 1974), the United States-Mexico-Canada Agreement and/or other trade agreements, tariffs, treaties or policies, as well as the uncertainty of obtaining and maintaining effective antidumping and countervailing duty orders to counteract the harmful effects of unfairly traded imports; impacts of existing and increasing governmental regulation, including climate change and other environmental regulation that may be proposed under the Biden Administration, and related costs and liabilities, including failure to receive or maintain required operating and environmental permits, approvals, modifications or other authorizations of, or from, any governmental or regulatory authority and costs related to implementing improvements to ensure compliance with regulatory changes, including potential financial assurance requirements; potential impacts to the environment or exposure to hazardous substances resulting from our operations; our ability to maintain adequate liquidity, our level of indebtedness and the availability of capital could limit cash flow necessary to fund working capital, planned capital expenditures, acquisitions, and other general corporate purposes or ongoing needs of our business; adverse changes in credit ratings, interest rates, foreign currency rates and tax laws; limitations on our ability to realize some or all of our deferred tax assets, including our net operating loss carryforwards; our ability to realize the anticipated synergies and benefits of the FPT Acquisition and to successfully integrate the business of FPT into our existing businesses, including uncertainties associated with maintaining relationships with customers, vendors and employees; additional debt we will incur in connection with the FPT Acquisition, as well as additional debt we incurred in connection with enhancing our liquidity during the COVID-19 pandemic, the merger with AK Steel Holding Corporation and the acquisition of ArcelorMittal USA LLC, may negatively impact our credit profile and limit our financial flexibility; known and unknown liabilities we will assume in connection with the FPT Acquisition; the ability of our customers, joint venture partners and third-party service providers to meet their obligations to us on a timely basis or at all; supply chain disruptions or changes in the cost or quality of energy sources or critical raw materials and supplies, including iron ore, industrial gases, graphite electrodes, scrap, chrome, zinc, coke and coal; liabilities and costs arising in connection with any business decisions to temporarily idle or permanently close a mine or production facility, which could adversely impact the carrying value of associated assets and give rise to impairment charges or closure and reclamation obligations, as well as uncertainties associated with restarting any previously idled mine or production facility; problems or disruptions associated with transporting products to our customers, moving products internally among our facilities or suppliers transporting raw materials to us; uncertainties associated with natural or human-caused disasters, adverse weather conditions, unanticipated geological conditions, critical equipment failures, infectious disease outbreaks, tailings dam failures and other unexpected events; our level of self-insurance and our ability to obtain sufficient third-party insurance to adequately cover potential adverse events and business risks; disruptions in, or failures of, our information technology systems, including those related to cybersecurity; our ability to successfully identify and consummate any strategic investments or development projects, cost-effectively achieve planned production rates or levels, and diversify our product mix and add new customers; our actual economic iron ore and coal reserves or reductions in current mineral estimates, including whether we are able to replace depleted reserves with additional mineral bodies to support the long-term viability of our operations; the outcome of any contractual disputes with our customers, joint venture partners, lessors, or significant energy, raw material or service providers, or any other litigation or arbitration; our ability to maintain our social license to operate with our stakeholders, including by fostering a strong reputation and consistent operational and safety track record; our ability to maintain satisfactory labor relations with unions and employees; availability of workers to fill critical operational positions and potential labor shortages caused by the COVID-19 pandemic, as well as our ability to attract, hire, develop and retain key personnel; unanticipated or higher costs associated with pension and other postretirement benefit obligations resulting from changes in the value of plan assets or contribution increases required for unfunded obligations; and potential significant deficiencies or material weaknesses in our internal control over financial reporting. The Company undertakes no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise.
For additional factors affecting the business of Cliffs, refer to Part I – Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2020, and other filings with the SEC.
FINANCIAL TABLES FOLLOW
CLEVELAND-CLIFFS INC. AND SUBSIDIARIES
STATEMENTS OF UNAUDITED CONDENSED CONSOLIDATED OPERATIONS
(In Millions, Except Per Share Amounts)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021
2020
2021
2020
Revenues
$
6,004
$
1,646
$
15,098
$
3,098
Operating costs:
Cost of goods sold
(4,229
)
(1,525
)
(11,838
)
(3,089
)
Selling, general and administrative expenses
(112
)
(59
)
(311
)
(149
)
Acquisition-related costs
(4
)
(7
)
(18
)
(68
)
Miscellaneous – net
(10
)
(17
)
(38
)
(41
)
Total operating costs
(4,355
)
(1,608
)
(12,205
)
(3,347
)
Operating income (loss)
1,649
38
2,893
(249
)
Other income (expense):
Interest expense, net
(81
)
(68
)
(258
)
(168
)
Gain (loss) on extinguishment of debt
—
—
(88
)
133
Net periodic benefit credits other than service cost component
46
9
139
30
Other non-operating income
1
1
5
1
Total other expense
(34
)
(58
)
(202
)
(4
)
Income (loss) from continuing operations before income taxes
1,615
(20
)
2,691
(253
)
Income tax benefit (expense)
(334
)
22
(559
)
98
Income (loss) from continuing operations
1,281
2
2,132
(155
)
Income from discontinued operations, net of tax
1
—
2
—
Net income (loss)
1,282
2
2,134
(155
)
Income attributable to noncontrolling interest
(8
)
(12
)
(39
)
(31
)
Net income (loss) attributable to Cliffs shareholders
$
1,274
$
(10
)
$
2,095
$
(186
)
Earnings (loss) per common share attributable to Cliffs shareholders - basic
Continuing operations
$
2.46
$
(0.02
)
$
3.87
$
(0.51
)
Discontinued operations
—
—
—
—
$
2.46
$
(0.02
)
$
3.87
$
(0.51
)
Earnings (loss) per common share attributable to Cliffs shareholders - diluted
Continuing operations
$
2.33
$
(0.02
)
$
3.69
$
(0.51
)
Discontinued operations
—
—
—
—
$
2.33
$
(0.02
)
$
3.69
$
(0.51
)
CLEVELAND-CLIFFS INC. AND SUBSIDIARIES
STATEMENTS OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL POSITION
(In Millions)
September 30,
2021
December 31,
2020
ASSETS
Current assets:
Cash and cash equivalents
$
42
$
112
Accounts receivable, net
2,348
1,169
Inventories
4,505
3,828
Other current assets
251
189
Total current assets
7,146
5,298
Non-current assets:
Property, plant and equipment, net
8,974
8,743
Goodwill
1,072
1,406
Deferred income taxes
70
537
Other non-current assets
804
787
TOTAL ASSETS
$
18,066
$
16,771
LIABILITIES
Current liabilities:
Accounts payable
$
1,828
$
1,575
Accrued employment costs
592
460
Pension and OPEB liabilities, current
151
151
Other current liabilities
708
743
Total current liabilities
3,279
2,929
Non-current liabilities:
Long-term debt
5,350
5,390
Pension and OPEB liabilities, non-current
3,773
4,113
Other non-current liabilities
1,374
1,260
TOTAL LIABILITIES
13,776
13,692
SERIES B PARTICIPATING REDEEMABLE PREFERRED STOCK
—
738
TOTAL EQUITY
4,290
2,341
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY
$
18,066
$
16,771
CLEVELAND-CLIFFS INC. AND SUBSIDIARIES
STATEMENTS OF UNAUDITED CONDENSED CONSOLIDATED CASH FLOWS
(In Millions)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021
2020
2021
2020
OPERATING ACTIVITIES
Net income (loss)
$
1,282
$
2
$
2,134
$
(155
)
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Depreciation, depletion and amortization
239
73
664
184
Amortization of inventory step-up
11
15
129
74
Changes in deferred revenue
6
(3
)
1
(46
)
Deferred income taxes
332
(17
)
557
(90
)
Pension and OPEB credits
(18
)
(3
)
Cleveland-Cliffs EPS beats by $0.09, beats on revenue
Oct. 22, 2021 7:03 AMCleveland-Cliffs Inc. (CLF)By: Niloofer Shaikh, SA News Editor
Cleveland-Cliffs (NYSE:CLF): Q3 GAAP EPS of $2.33 beats by $0.09.
Revenue of $6B (+263.6% Y/Y)
Cleveland-Cliffs Q3 2021 Earnings Preview
Oct. 21, 2021 12:16 PM ETCleveland-Cliffs Inc. (CLF)By: Deepa Sarvaiya, SA News Editor2 Comments
Cleveland-Cliffs (NYSE:CLF) is scheduled to announce Q3 earnings results on Friday, October 22nd, before market open.
The consensus EPS Estimate is $2.23 (+5475.0% Y/Y) and the consensus Revenue Estimate is $5.63B (+251.9% Y/Y).
Analyst expects adjusted Ebitda estimate $1.83 billion (range $1.80 billion to $1.91 billion).
Over the last 2 years, CLF has beaten EPS estimates 50% of the time and has beaten revenue estimates 38% of the time.
Over the last 3 months, EPS estimates have seen 3 upward revisions and 2 downward. Revenue estimates have seen 2 upward revisions and 2 downward.
Read Next: Cleveland-Cliffs: Still Attractive As It Widens Its Competitive Moat
Finally a news organization showing this scam. IMO.
‘The next Henry Ford’ raised millions to build a $7,000 car. His company still bled cash.
https://www.usatoday.com/in-depth/money/cars/2021/10/19/paul-elio-motors-investments-debt/5929991001/
Up .61 today. What do you think?
The total return for Cleveland-Cliffs (NYSE:CLF) investors has risen faster than earnings growth over the last five years
https://simplywall.st/stocks/us/materials/nyse-clf/cleveland-cliffs/news/the-total-return-for-cleveland-cliffs-nyseclf-investors-has
Cleveland-Cliffs Stock Could Soon Notch Multi-Year High
Fernanda Horner
October 19, 2021, 2:44 pm
Just one week after call traders blasted Cleveland-Cliffs Inc (NYSE:CLF) on its $775 million acquisition of Ferrous Processing and Trading, the steel and iron producer is in the spotlight again. The security is down 0.8% at $21.22 at last check, after it received a price-target cut from Morgan Stanley to $21 from $26. However, this pullback may prove to be a short-lived one, as the equity is near a historically bullish trendline that may soon push it higher.
https://finance.yahoo.com/news/cleveland-cliffs-stock-could-soon-184419669.html
The major players operating in the global Iron Ore Concentrate (Pellet Feed) market are
Arya Group
Fortescue Metals Group
Rio Tinto
Arrium (SIMEC)
Champion Minerals
BHP Billiton
BC Iron
Iron Ore Company
Companhia Siderurgica Nacional
Australasian Resources
Cap-Ex Ventures
Vale
Cliffs Natural Resources
Gerdau
Fortescue Metals Group Ltd
Baotou Iron & Steel
Sinosteel
Labrador Iron Mines
Sundance Resources
Sundance Resources
Metso
Atlas Iron Limited
National Iranian Steel
Cleveland-Cliffs
https://puck77.com/electric-vehicles/21664/iron-ore-concentrate-pellet-feed-market-regional-landscape-by-growth-enablers-arya-group-fortescue-metals-group-rio-tinto-arrium-simec-champion-minerals-etc/
New Purchases: DFAX, LUV, CLF, HPQ, UBER,
https://www.gurufocus.com/news/1547565/sterneck-capital-management-llc-buys-wells-fargo-dimensional-world-ex-us-core-equity-2-etf-kraneshares-csi-china-internet-etf-sells-first-trust-inter-dur-pref-income-fund-avantis-us-small-cap-value-etf-guggenheim-enhanced-equity-income-fund
“We now recognize the equation,” Cleveland Cliffs CEO Lourenco Goncalves agreed. “We export our jobs and economic might, and in return, America gets some cheap goods, global pollution, hollowed out communities, drug addiction, and the politics of division.”
https://www.cleveland.com/open/2021/10/congressional-committee-visits-lorain-searching-for-ways-to-retool-the-rust-belt-economy.html
Steel Earnings: Steel Dynamics Beats; Nucor, Cleveland-Cliffs On Tap Amid Peak Steel Price Fears
JED GRAHAM
08:40 AM ET 10/19/2021
Steel Dynamics (STLD) reported better-than-expected third-quarter results late Monday, kicking off a big week for steel stock earnings. STLD stock rose early Tuesday.
Jones, Industrial Average and Russell 2000, basically flat up
Nucor (NUE) earnings are due Thursday afternoon and Cleveland-Cliffs (CLF) reports early Friday. Record profits are expected across the board.
The week started with a downer as Morgan Stanley slashed its price target for STLD, NUE and CLF stocks, as well as U.S. Steel (X).
Analyst Carlos De Alba says he expects investor worries that steel prices have peaked to weigh on steel stocks, working against any near-term rally. De Alba downgraded STLD stock to equal weight from overweight, cutting his price target to 61 from 77. NUE stock's price target went to 105 from 115 and CLF's target to 21 from 26.
Meanwhile, Morgan Stanley cut U.S. Steel to underweight from overweight and axed its X stock price target to 17 from 35. On top of peak price worries, De Alba noted U.S. Steel's big spending plans. U.S. Steel earnings will follow on Oct. 29.
So is Morgan Stanley too bearish? This week's earnings reports will help Wall Street gauge how long the good times can last.
Steel Dynamics Earnings
Steel Dynamics earnings were seen exploding to $4.95 from 51 cents a year ago, according to Zacks Investment Research. Revenue was seen more than doubling to $4.99 billion.
Steel Dynamics earnings came in $4.96 a share, just beating views. However, another consensus forecast had EPS at $4.57, which STLD comfortably beat. Revenue leapt 118.5% to $5.09 billion.
"We continue to see strong steel demand coupled with moderating, but still historically low customer inventories throughout the supply chain," CEO Mark Millett said in a statement. "We believe this momentum will continue and that our fourth quarter consolidated earnings could represent another record performance."
STLD stock rose 1.8% early Tuesday.
NUE, CLF Earnings Estimates
Nucor is expected to earn $7.21 per share, up more than 900% from 63 cents a year ago, as revenue doubles to $10.10 billion.
Cleveland-Cliffs earnings per share also should be off the charts, though that's partly because year-ago results didn't account for the its purchase of ArcelorMittal's (MT) USA operations. That deal closed in December. CLF earnings are expected to rise to $2.22 per share vs. 4 cents a year ago. Revenue is seen up 240% to $5.65 billion.
Steel Stocks: STLD, NUE, CLF, X
Despite the bearish Morgan Stanley call, steel stocks rallied off their lows on Monday. STLD stock rose 0.9% to 62.42, after trading as low as 59.30. After hours, STLD stock rose 1.7% to 63.50.
During the regular session, Nucor climbed 0.7% and CLF stock dipped 0.4%. X stock, though well off its lows, still lost 1.2%.
From a broader perspective, the four steel stocks have all lost momentum after big runs over the past year. But they're trying to move higher again.
On a positive note, Steel Dynamics, Cleveland-Cliffs and Nucor stock closed above their 21-day moving averages and arguably are breaking trend lines. But they're all below their 50-day moving averages.
A move by STLD, NUE and CLF above their 50-day lines, however, could offer an early entry.
X stock, meanwhile, is not only below its 50-day line but its 21-day and 200-day lines as well.
In premarket action, NUE stock, Cleveland-Cliffs and U.S. Steel rose roughly 1% following Steel Dynamics earnings.
Be sure to read IBD's The Big Picture column each day to stay on top of the prevailing market trend and be sure that growth stock investors still have a green light to buy quality stocks in buy range.
Steel Outlook
Rising supply will be a concern to watch. Steel Dynamics is nearing completion of its Sinton, Texas, flat roll steel mill, with production on track to start before year-end. The company expects the mill to ship up to 2.2 million tons next year.
On a longer timeline, Nucor announced in September plans for a $100-million expansion of a bar mill, adding 600,000 tons of capacity. Nucor also said it will build a $2.7-billion sheet mill with a capacity of 3 million tons. Meanwhile, U.S. Steel is looking to build a $3 billion, 3-million-ton mini mill.
However, there are plenty of positives in the demand outlook, including the bipartisan infrastructure bill with about $550 billion in additional spending planned. In Nucor's July 22, Q2 earnings call, CEO Leon Topalian said the infrastructure bill should boost steel demand "by as much as 5 million tons per year for every $100 billion of new investment."
Other strengths include lean stocks throughout the supply chain, with automakers needing to rebuild "staggeringly low" inventories, he said.
The lift in oil prices also could boost demand in the oil sector that's been a drag throughout the pandemic.
How Have the Numbers Shaped Up for Cleveland-Cliffs?
For Cleveland-Cliffs, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +0.56%.
https://finance.yahoo.com/news/cleveland-cliffs-clf-reports-next-190007047.html
You think with profits like that, why wouldn't this stock be a $100 per share.
Cleveland-Cliffs and Lourenco Goncalves Awarded Top Honors at S&P Global Platts 2021 Global Metals Ceremony
Source: Business Wire
Lourenco Goncalves Named CEO/Chairperson of the Year
Company also awarded Metals Company of the Year and the Deal of the Year
Cleveland-Cliffs Inc. (NYSE: CLF) announced today it took top honors in three categories at the Annual S&P Global Platts Global Metals Award ceremony in London, England on October 14. Lourenco Goncalves was awarded CEO/Chairperson of the Year. Cleveland-Cliffs was named Metals Company of the Year and the company received the Deal of the Year award.
Lourenco Goncalves, Chairman, President and CEO, said, “It is a tremendous honor to be selected and recognized by S&P Global Platts in the worldwide metals industry within three significant award categories. 2020 was a transformative and extraordinary year for Cleveland-Cliffs with the acquisitions of two major steel companies and the start up of our state-of-the-art direct reduction plant. I am pleased that the judges recognized our outstanding results and milestones achieved by our organization during an unprecedented year across the entire world.”
Mr. Goncalves added: “It is especially a great honor and recognition to be named CEO/Chairperson of the Year among my industry peers. It is my distinct privilege to lead Cleveland-Cliffs and to provide the strategic vision and decision-making necessary to evolve the company into the powerhouse that it is today. This is a new era for Cleveland-Cliffs as we have increased our annual revenues from $2 billion in 2019, to $5 billion in 2020, to an expected $21 billion dollars in 2021. This remarkable transformation was made possible by the support, enthusiasm and hard work of our executive team and our 25,000 employees across the company.”
S&P Global Platts’ CEO/Chairperson of the Year Award honors a leader who is highly respected by both peers and competitors, admired and followed by employees, trusted by investors and welcomed by the community. This award recognizes an individual who has taken decisive action when required, and who has best adapted to market shifts by balancing long-term growth with short-term challenges.
In selecting the Metals Company of the Year, the S&P Global Platts’ Global Metals Award judges do not take nominations as they select a company for all-around excellence in executing a total metals strategy. The range and extent of a company's activities—its diversity, scope, technological innovation, and environmental concern—are pivotal factors, as are the traditional values of concern for the end user and efficiency. Particular attention is paid to each company's commitment to sustainability. The winner of the Metals Company of the Year stands above all others.
The Deal of the Year Award recognizes the significance and success of asset buyouts, joint ventures, strategic company alliances or full company mergers or acquisitions, as well as strategic spin-offs that strengthened organizations.
About Cleveland-Cliffs Inc.
Cleveland-Cliffs is the largest flat-rolled steel producer in North America. Founded in 1847 as a mine operator, Cliffs also is the largest manufacturer of iron ore pellets in North America. The Company is vertically integrated from mined raw materials and direct reduced iron to primary steelmaking and downstream finishing, stamping, tooling, and tubing. The Company serves a diverse range of markets due to its comprehensive offering of flat-rolled steel products and is the largest supplier of steel to the automotive industry in North America. Headquartered in Cleveland, Ohio, Cleveland-Cliffs employs approximately 25,000 people across its mining, steel and downstream manufacturing operations in the United States and Canada. For more information, visit www.clevelandcliffs.com.
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View source version on businesswire.com: https://www.businesswire.com/news/home/20211015005208/en/
MEDIA CONTACT:
Patricia Persico
Director, Corporate Communications
(216) 694-5316
INVESTOR CONTACT:
James Kerr
Manager, Investor Relations
(216) 694-7719
Coke oven at Middletown Works idle and may be torn down; company buys scrap business for $775M
https://www.journal-news.com/news/coke-oven-at-middletown-works-idle-may-be-torn-down-no-layoffs-planned-according-to-union/KAWMIEUK2VHSHCIQHKDGACBBXM/
Cheap Enough for You? Here's My Plan to Trade Cleveland-Cliffs
https://realmoney.thestreet.com/investing/cheap-enough-for-you-here-s-my-plan-to-trade-cleveland-cliffs-15795186
FPT bought by Cleveland-Cliffs
https://www.recyclingtoday.com/article/fpt-cleveland-cliffs-ferrous-scrap-recycling-steel-acquisition/
Hey all you shorts, what do you think about this scam company.
LOL LOL
Is Cleveland-Cliffs Inc. (NYSE:CLF) Trading At A 41% Discount?
https://www.nasdaq.com/articles/is-cleveland-cliffs-inc.-nyse%3Aclf-trading-at-a-41-discount-2021-10-09
Cleveland Cliffs Stock Is A Steel Play
https://www.investing.com/analysis/cleveland-cliffs-stock-is-a-steel-play-200604435
Looking for a Double on Cleveland-Cliffs
https://realmoney.thestreet.com/investing/stocks/looking-for-a-double-on-cleveland-cliffs-15794042
But Goldman also upgrades Cleveland-Cliffs (NYSE:CLF) to Buy from Neutral with a $24 target, as analyst Emily Chieng says "idiosyncratic opportunities" in the company are underappreciated, and raises Commercial Metals (NYSE:CMC) to Neutral from Sell with a $33 target, citing rela