Cleveland-Cliffs (NYSE:CLF) Shares Gap Down Following Weak Earnings

Cleveland-Cliffs Inc. (NYSE:CLF)’s stock price gapped down prior to trading on Tuesday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $20.85, but opened at $19.92. Cleveland-Cliffs shares last traded at $19.31, with a volume of 6,367,132 shares traded.

The mining company reported $0.18 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.19 by ($0.01). The company had revenue of $5.20 billion during the quarter, compared to analysts’ expectations of $5.34 billion. Cleveland-Cliffs had a return on equity of 8.50% and a net margin of 1.78%. Cleveland-Cliffs’s revenue for the quarter was down 1.8% compared to the same quarter last year. During the same period in the prior year, the firm earned ($0.11) EPS.

Cleveland-Cliffs announced that its board has approved a stock repurchase program on Monday, April 22nd that allows the company to repurchase $1.50 billion in shares. This repurchase authorization allows the mining company to purchase up to 17.2% of its stock through open market purchases. Stock repurchase programs are often a sign that the company’s board believes its shares are undervalued.

Wall Street Analysts Forecast Growth

Several equities research analysts recently commented on CLF shares. Argus downgraded Cleveland-Cliffs from a “buy” rating to a “hold” rating in a report on Thursday, February 8th. Citigroup downgraded Cleveland-Cliffs from a “buy” rating to a “neutral” rating and set a $22.00 price objective for the company. in a report on Wednesday, March 13th. StockNews.com upgraded Cleveland-Cliffs from a “hold” rating to a “buy” rating in a report on Thursday, April 18th. BNP Paribas downgraded Cleveland-Cliffs from a “neutral” rating to an “underperform” rating and set a $16.50 price target for the company. in a research note on Wednesday, February 28th. Finally, Morgan Stanley restated an “equal weight” rating and set a $20.00 price target on shares of Cleveland-Cliffs in a research note on Tuesday, March 26th. Two investment analysts have rated the stock with a sell rating, three have issued a hold rating and three have issued a buy rating to the company’s stock. According to data from MarketBeat, Cleveland-Cliffs has a consensus rating of “Hold” and a consensus price target of $20.75.

Insider Activity at Cleveland-Cliffs

In related news, CEO Lourenco Goncalves sold 187,136 shares of the business’s stock in a transaction that occurred on Wednesday, March 6th. The stock was sold at an average price of $20.19, for a total transaction of $3,778,275.84. Following the completion of the transaction, the chief executive officer now directly owns 2,699,089 shares in the company, valued at approximately $54,494,606.91. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. In related news, EVP Terry G. Fedor sold 27,430 shares of the business’s stock in a transaction that occurred on Wednesday, March 6th. The stock was sold at an average price of $20.19, for a total value of $553,811.70. Following the transaction, the executive vice president now directly owns 534,617 shares of the company’s stock, valued at approximately $10,793,917.23. The transaction was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. Also, CEO Lourenco Goncalves sold 187,136 shares of the business’s stock in a transaction that occurred on Wednesday, March 6th. The stock was sold at an average price of $20.19, for a total value of $3,778,275.84. Following the completion of the transaction, the chief executive officer now directly owns 2,699,089 shares in the company, valued at $54,494,606.91. The disclosure for this sale can be found here. In the last ninety days, insiders sold 221,066 shares of company stock worth $4,464,688. 1.76% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of large investors have recently added to or reduced their stakes in the business. Exchange Traded Concepts LLC purchased a new stake in shares of Cleveland-Cliffs during the 3rd quarter worth approximately $29,000. Anchor Investment Management LLC purchased a new stake in shares of Cleveland-Cliffs during the 4th quarter worth approximately $31,000. Lindbrook Capital LLC raised its holdings in shares of Cleveland-Cliffs by 83.7% during the 4th quarter. Lindbrook Capital LLC now owns 1,571 shares of the mining company’s stock worth $32,000 after acquiring an additional 716 shares in the last quarter. Rise Advisors LLC raised its holdings in shares of Cleveland-Cliffs by 2,858.0% during the 1st quarter. Rise Advisors LLC now owns 1,479 shares of the mining company’s stock worth $34,000 after acquiring an additional 1,429 shares in the last quarter. Finally, HighMark Wealth Management LLC purchased a new stake in shares of Cleveland-Cliffs during the 4th quarter worth approximately $35,000. 67.68% of the stock is owned by hedge funds and other institutional investors.

Cleveland-Cliffs Stock Down 1.3 %

The firm has a market capitalization of $8.71 billion, a PE ratio of 24.74, a PEG ratio of 0.72 and a beta of 2.03. The company has a fifty day moving average price of $20.97 and a 200-day moving average price of $19.00. The company has a debt-to-equity ratio of 0.39, a quick ratio of 0.62 and a current ratio of 1.89.

Cleveland-Cliffs Company Profile

Cleveland-Cliffs is the largest flat-rolled steel company and the largest iron ore pellet producer in North America. The company is vertically integrated from mining through iron making, steelmaking, rolling, finishing and downstream with hot and cold stamping of steel parts and components. The company was formerly known as Cliffs Natural Resources Inc and changed its name to Cleveland-Cliffs Inc in August 2017.