Cleveland-Cliffs Inc. (NYSE: CLF) is a flat-rolled steel and iron ore pellets manufacturer in North America. It is vertically integrated from mined raw materials and direct reduced iron to primary steelmaking and downstream finishing, stamping, tooling, and tubing. Because of its complete offering of flat-rolled steel products and steel supply to the automobile sector in North America, the company serves a wide range of markets.
Why should Investors Book Profits?
Valuation Methodology: Price/Cash Flow Multiple Based Relative Valuation
(Analysis by Kalkine Group)
* % Premium/(Discount) is based on our assessment of the company's FY1 trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.
CLF's stock price has surged 29.20% in the past month and is currently trading close to the higher-band of its 52-week range of USD 14.01 to USD 27.79. We have valued the stock using the Price/Cash Flow-based relative valuation methodology and arrived at a target price of USD 22.20.
Considering the surge in the stock price in a brief period, below industry margins, leveraged balance sheet, current valuation, and unfavourable technical indicators, we recommend a "Sell" rating on the stock at the current price of USD 26.745, up 1.10% as of March 11, 2022, at 12:23 PM ET.
Three-Year Technical Price Chart (as of March 11, 2022, at 12:23 PM ET). Source: REFINITIV, Analysis by Kalkine Group
* The reference data in this report has been partly sourced from REFINITIV.
* All forecasted figures and industry information have been taken from REFINITIV.