The Rising Influence of Rising Affluence

[DewDiligence]

CLF—What I find notable is that the dividend is not mentioned in the PR.

That’s a sure sign that the BoD has not already decided on a dividend cut, although it leaves the door open for a cut later.

As you noted, the revised cash-flow forecast for 2012 covers cap-ex and the dividend. Moreover, CLF has ample liquidity from cash on hand ($159M) and the untapped portion of its credit line ($1.425B) to handle a modest reduction in cash flow relative to the revised guidance, so there won’t be a compelling need for a dividend cut unless the iron-ore market turns very much worse than any of the major companies in the industry currently expects.

For CLF to cut the dividend so soon after raising it with great fanfare would cause a colossal loss of face, so I’m pretty sure it won’t happen anytime soon. I expect CLF to say as much on tomorrow's CC.