The Case for and Against Cleveland-Cliffs Inc. (CLF)

Cleveland-Cliffs Inc. (CLF) is an interesting player in the Basic Materials space, with a focus on Industrial Metals & Minerals. The stock has been active on the tape, currently trading at $7.29, down from yesterday’s close by -2.93%. Given the stock’s recent action, it seemed like a good time to take a closer look at the company’s recent data.

Fundamental Analysis

Cleveland-Cliffs Inc. (CLF) currently trades with a market capitalization of $2.21 Billion. That value represents a market adjusting for revenues that have been falling by -20.31 % on a quarterly year/year basis as of the company’s last quarterly report.

You can get a sense of how sustainable that is by a levered free cash flow of $186.4 Million over the past twelve months. Generally speaking, earnings are expected to grow in coming quarters. Analysts are forecasting earnings of -$0.2 on a per share basis this quarter. Perhaps, that suggests something about why 2.48% of the outstanding share supply is held by institutional investors.

Technical Analysis

As most professionals know, technical analysis can offer critical insights into what smart money and insiders think about a stock’s prospects going forward. Looking at the stock’s movement on the chart, Cleveland-Cliffs Inc. recorded a 52-week high of $9.92. It is now trading 2.63% off that level. The stock is trading $7.62 its 50-day moving average by 0.33%. The stock carved out a 52-week low down at $5.56.

In recent action, Cleveland-Cliffs Inc. (CLF) has made a move of +5.04% over the past month, which has come on Strong relative transaction volume. Over the trailing year, the stock is underperforming the S&P 500 by 16.68, and it’s gotten there by action that has been more volatile on a day-to-day basis than most other stocks on the exchange. In terms of the mechanics underlying that movement, traders will want to note that the stock is trading on a float of 14.10% with $294.98 Million sitting short, betting on future declines. That suggests something of the likelihood of a short squeeze in shares of CLF.

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