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1. Company Snapshot

1.a. Company Description

Cleveland-Cliffs Inc.operates as a flat-rolled steel producer in North America.The company offers carbon steel products, such as hot-rolled, cold-rolled, electrogalvanized, hot-dip galvanized, hot-dip galvannealed, aluminized, enameling, and advanced high-strength steel products; stainless steel products; plates; and grain oriented and non-oriented electrical steel products.


It also provides tubular components, including carbon steel, stainless steel, and electric resistance welded tubing.In addition, the company offers tinplate products, such as electrolytic tin coated and chrome coated sheet, and tin mill products; tooling and sampling; raw materials; ingots, rolled blooms, and cast blooms; and hot-briquetted iron products.Further, it owns five iron ore mines in Minnesota and Michigan.


The company serves automotive, infrastructure and manufacturing, distributors and converters, and steel producers.Cleveland-Cliffs Inc.was formerly known as Cliffs Natural Resources Inc.


and changed its name to Cleveland-Cliffs Inc.in August 2017.The company was founded in 1847 and is headquartered in Cleveland, Ohio.

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1.b. Last Insights on CLF

Cleveland-Cliffs' recent performance was positively driven by several factors. The company's Q3 earnings call revealed a better-than-expected loss per share, and management's guidance was encouraging. Additionally, institutional investors such as AXQ Capital LP and Commonwealth of Pennsylvania Public School Empls Retrmt SYS increased their stakes in the company, demonstrating confidence in its prospects. The appointment of Edilson Camara to the Board of Directors also brought fresh perspectives to the company. Furthermore, Cleveland-Cliffs' debt issue was well-received by the market, showcasing investors' appetite for the company's credit.

1.c. Company Highlights

2. Cleveland-Cliffs' Q3 2025 Earnings: A Rebound in Sight?

Cleveland-Cl, the integrated steel company, reported an adjusted EBITDA of $143 million, a 52% increase over the prior quarter, driven by margin expansion from higher realized prices and improved mix. The company's steel shipment volumes were 4 million tons, a reduction from the prior quarter due to summer slowdowns. The actual EPS came out at '-0.45', beating estimates at '-0.48'. Revenue growth is expected to be around 5.8% next year, according to analysts' estimates. The company's current valuation metrics, such as a P/E Ratio of -3.14 and an EV/EBITDA of -35.16, suggest that the market is still cautious about the company's prospects.

Publication Date: Nov -05

📋 Highlights
  • Adjusted EBITDA Surge:: Q3 adjusted EBITDA rose 52% to $143 million from $94 million in Q2.
  • Automotive Demand Recovery:: Multi-year contracts with major OEMs secure higher sales volumes and pricing until 2027–2028.
  • Galvanized Steel Capacity:: Nine plants (five for exposed parts) position the company to meet automotive sector growth.
  • Debt Reduction Potential:: $1.7 billion gross debt with ample cash flow improvement from operational efficiencies.
  • Rare Earth Exploration:: Two sites identified for mineralization, with commercial viability assessments underway.

Operational Improvements

Celso Goncalves, CFO, stated that the company's operational improvements, footprint optimizations, and reductions in overhead and capital costs have enabled it to navigate the recession-like conditions in the primary end markets it serves. The company has a gross debt amount of $1.7 billion but has ample opportunity to pay it down over the coming quarters. As Lourenco Goncalves emphasized, "the company is not declaring victory yet," but expects to continue to improve its EBITDA and cash flow, driven by increasing automotive volumes and the execution of the final agreement with its global steelmaker partner.

Automotive Sector Growth

The company has secured multi-year agreements with major automotive OEMs, covering higher sales volumes and favorable pricing through 2027 or 2028. Cleveland-Cliffs has nine automotive-grade galvanized steel plants, with five designed to produce exposed parts in all specs. The resurgence of the U.S. auto sector, supported by domestic steel, is a matter of great urgency, and the company is well-positioned to supply the growing demand for domestic steel, particularly in the automotive sector. New contracts kicked in on October 1, generating more margin for the company, and the company's capacity to produce steels for the automotive industry is expected to grow.

Diversification into Rare Earth Products

Lourenco Goncalves mentioned that the company has identified two promising sites for rare earth mineralization and is working with geologists to assess their commercial viability. The company has a long history of mining and is well-positioned to develop the opportunity, either in the United States or in partnership with Canada. This potential diversification into rare earth products could be a positive development for the company, and the current valuation metrics do not seem to fully reflect this potential.

Valuation and Dividend Yield

The company's current P/B Ratio is 0.ROE is at -27.43%, and the company doesn't pay a dividend, resulting in a 0.0% Dividend Yield. The negative valuation metrics and the lack of dividend payment are a reflection of the challenges the company is facing, but the expected growth in the automotive sector and the potential diversification into rare earth products could be a positive catalyst for the stock.

3. NewsRoom

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Cleveland-Cliffs Inc. $CLF Shares Sold by Creative Planning

Dec -01

Source: defenseworld.net

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Cleveland-Cliffs Inc. $CLF Stake Raised by Commonwealth of Pennsylvania Public School Empls Retrmt SYS

Nov -24

Source: defenseworld.net

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AXQ Capital LP Acquires 52,682 Shares of Cleveland-Cliffs Inc. $CLF

Nov -22

Source: defenseworld.net

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Steel Stock Extends Recovery Amid Emerging Support

Nov -17

Source: schaeffersresearch.com

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What's Behind Cleveland-Cliffs Stock 25% Drop?

Nov -17

Source: forbes.com

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Prem Watsa's Strategic Moves: BlackBerry Ltd Sees a -1.32% Portfolio Impact

Nov -14

Source: gurufocus.com

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Cleveland-Cliffs Appoints Edilson Camara to the Board of Directors

Nov -12

Source: businesswire.com

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Cleveland-Cliffs Is Pulled By Diverging Macro Forces (Rating Downgrade)

Nov -04

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.83%)

6. Segments

Steelmaking

Expected Growth: 4.83%

Cleveland-Cliffs Inc.'s 4.83% growth in steelmaking is driven by increasing demand from the automotive and construction industries, coupled with the company's strategic acquisitions and investments in modernizing its production facilities. Additionally, the company's focus on producing high-margin, value-added steel products and its ability to pass through raw material costs to customers have contributed to its growth.

Other

Expected Growth: 4.83%

Cleveland-Cliffs Inc.'s 4.83% growth in 'Other' segment is driven by increasing demand for iron ore pellets, rising steel production in the US, and growing exports to Asia. Additionally, the company's cost savings initiatives, improved operational efficiency, and favorable pricing environment have contributed to this growth.

7. Detailed Products

Iron Ore Pellets

High-quality iron ore pellets used as a raw material in steel production

Hot-Briquetted Iron (HBI)

A compacted form of direct reduced iron used as a raw material in steel production

Drill Pipe

High-strength steel pipes used in oil and gas drilling operations

Line Pipe

High-strength steel pipes used in oil and gas transportation

Tubular Products

A range of steel tubular products used in oil and gas, construction, and industrial applications

Flat-Rolled Carbon Steel

A range of flat-rolled carbon steel products used in automotive, construction, and consumer goods industries

Electrical Steel

Specialized steel products used in electrical transformers and motors

8. Cleveland-Cliffs Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Cleveland-Cliffs Inc. is medium due to the availability of alternative materials and products that can replace iron ore and steel.

Bargaining Power Of Customers

The bargaining power of customers for Cleveland-Cliffs Inc. is low due to the company's strong market position and limited customer concentration.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Cleveland-Cliffs Inc. is medium due to the presence of multiple suppliers and the company's ability to negotiate prices.

Threat Of New Entrants

The threat of new entrants for Cleveland-Cliffs Inc. is low due to the high barriers to entry in the iron ore and steel industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry for Cleveland-Cliffs Inc. is high due to the competitive nature of the iron ore and steel industry, with multiple players competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 29.04%
Debt Cost 12.25%
Equity Weight 70.96%
Equity Cost 14.41%
WACC 13.78%
Leverage 40.92%

11. Quality Control: Cleveland-Cliffs Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Cabot

A-Score: 5.5/10

Value: 7.1

Growth: 6.4

Quality: 6.0

Yield: 5.0

Momentum: 1.0

Volatility: 7.7

1-Year Total Return ->

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Reliance Steel & Aluminum

A-Score: 5.3/10

Value: 4.6

Growth: 6.1

Quality: 5.6

Yield: 3.0

Momentum: 4.0

Volatility: 8.7

1-Year Total Return ->

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Nucor

A-Score: 5.1/10

Value: 6.5

Growth: 5.9

Quality: 4.7

Yield: 4.0

Momentum: 3.5

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Steel Dynamics

A-Score: 4.9/10

Value: 3.4

Growth: 7.1

Quality: 5.1

Yield: 2.0

Momentum: 6.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
CMC

A-Score: 4.4/10

Value: 3.9

Growth: 3.8

Quality: 4.5

Yield: 2.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Cleveland-Cliffs

A-Score: 3.6/10

Value: 9.2

Growth: 3.1

Quality: 3.5

Yield: 0.0

Momentum: 4.0

Volatility: 2.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

12.29$

Current Price

12.29$

Potential

-0.00%

Expected Cash-Flows