Cleveland-Cliffs Inc (NYSE: CLF) has experienced a remarkable surge in its stock price, with an 18.29% gain over the past week and an impressive 47.59% gain over the past three months. The company's market capitalization now stands at $10.35 billion, with the current stock price at $20.5. This performance is particularly noteworthy when considering the company's GF Value, which is currently at $23.61. This valuation suggests that the stock is modestly undervalued, a positive shift from its past GF Value of $29.91, which indicated a possible value trap. Investors are now looking at Cleveland-Cliffs with renewed interest as the company's valuation aligns more closely with its intrinsic value.
Introduction to Cleveland-Cliffs Inc
Cleveland-Cliffs Inc, a titan in the steel industry, is a leading producer of flat-rolled steel and iron ore pellets in North America. The company's operations are vertically integrated, extending from mining raw materials to producing finished steel products. With a focus on serving the automotive industry, Cleveland-Cliffs has a diverse market reach, including operations in the United States, Canada, and other countries. The majority of its revenue is generated within the United States, cementing its position as a key supplier to North American automakers.
Assessing Cleveland-Cliffs' Profitability
With a Profitability Rank of 8/10, Cleveland-Cliffs stands out in its sector. The company's Operating Margin of 2.73% is better than 40.26% of its industry peers. Additionally, its ROE of 4.45%, ROA of 1.82%, and ROIC of 2.78% are all above the median for the industry, indicating efficient management and a strong competitive position. Over the past decade, Cleveland-Cliffs has maintained profitability for seven years, showcasing its resilience and operational efficiency.
Growth Trajectory of Cleveland-Cliffs
The company's Growth Rank is an impressive 9/10. Cleveland-Cliffs has demonstrated exceptional growth, with a 3-Year Revenue Growth Rate per Share of 84.30% and a 5-Year Revenue Growth Rate per Share of 53.70%, outperforming 98.3% and 98.56% of industry peers, respectively. The company's 3-Year EPS without NRI Growth Rate of 33.40% further solidifies its growth status, surpassing 56.49% of its competitors. These figures reflect Cleveland-Cliffs' strong market position and its ability to capitalize on industry trends and opportunities.
Notable Shareholders in Cleveland-Cliffs
Among the notable shareholders of Cleveland-Cliffs, Ken Fisher (Trades, Portfolio) holds the largest stake with 7,743,452 shares, representing 1.53% of the company. Jeremy Grantham (Trades, Portfolio) follows with 2,052,127 shares, accounting for 0.41% share percentage, and Joel Greenblatt (Trades, Portfolio) holds 714,361 shares, making up 0.14% of the shares. These significant investments by well-known investors signal confidence in the company's future prospects and stability.
Competitive Landscape
When compared to its closest competitors, Cleveland-Cliffs maintains a competitive edge. United States Steel Corp (X, Financial) has a market cap slightly higher at $11.06 billion, while Ternium SA (TX, Financial) and Commercial Metals Co (CMC, Financial) have market caps of $8.4 billion and $5.56 billion, respectively. Cleveland-Cliffs' recent stock performance and growth metrics suggest that it is holding its own in a competitive industry.
Conclusion
In summary, Cleveland-Cliffs Inc's recent stock performance has been impressive, with significant gains over the past week and three months. The company's current valuation indicates that it is modestly undervalued, which may attract more investors seeking value opportunities. Cleveland-Cliffs' strong profitability and growth metrics, combined with the confidence shown by its significant shareholders, position it well within the steel industry. As the company continues to navigate the market and leverage its strengths, it remains a noteworthy stock for value investors to consider.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
