Cleveland-Cliffs (CLF, Financial) stock experienced a sharp decline due to disappointing third-quarter earnings results. The company reported an adjusted loss of $0.33 per share, which was below analysts' expectations. Consequently, the stock price fell by 9.04%.
Analyzing the current stock performance of Cleveland-Cliffs (CLF, Financial), the company's market capitalization stands at $5.58 billion with a current stock price of $11.93. The stock is notably undervalued when compared to its GF Value of $17.55. This implies that Cleveland-Cliffs is significantly undervalued in the market. For more insights, check the GF Value.
Despite the recent downturn, Cleveland-Cliffs shows a Piotroski F-Score of 7, indicating a robust financial position. However, there are some financial warning signs, including a declining gross margin, with a long-term decline rate of -24.6%. The company's ROIC is currently less than its WACC, suggesting that it might not be capital-efficient.
The challenges have largely stemmed from declining steel demand, especially from the automotive sector, which comprises a significant portion of Cleveland-Cliffs' shipments. Other steelmakers, like Nucor, are also facing similar challenges, further highlighting the industry's current struggles.
Despite the current headwinds, Cleveland-Cliffs' CEO, Lourenco Goncalves, predicts a rebound in steel demand by early 2025, driven by various economic and political factors. This potential future growth, combined with the company’s recent acquisition of Canadian steel company Stelco, could provide a foundation for a recovery in the coming years.
