Cleveland-Cliffs Inc. (CLF) has secured a four-year labor deal with the United Auto Workers (UAW) at its Dearborn Works operations. The company also reported a decline in its second-quarter earnings and revenues, citing reduced steelmaking revenues and selling prices. Despite the challenges, Cleveland-Cliffs remains optimistic about its cost reduction initiatives and its outlook for the future.
Cleveland-Cliffs (NYSE: CLF) reported a relatively lackluster Q1’24 due to headwinds in the steel market and geopolitical pressures. Despite these challenges, the company remains focused on its long-term decarbonization initiatives and cost-cutting measures. Management also announced a $1.5 billion share repurchase program. While the near-term outlook is uncertain, the company’s positive long-term prospects and efforts to enhance shareholder value warrant a BUY recommendation with a price target of $28.05/share.
Lourenco Goncalves, CEO of Cleveland-Cliffs, joined ‘Closing Bell Overtime’ to discuss the company’s quarterly results, share buybacks, and provide insights on the U.S. Steel-Nippon deal. He also shared his thoughts on the overall steel industry landscape.
Cleveland-Cliffs CEO Lourenco Goncalves appeared on ‘Closing Bell Overtime’ to discuss the company’s quarterly results, share buybacks, and the U.S. Steel-Nippon deal. Here’s a summary of the key points covered:
Cleveland-Cliffs executives reiterated their interest in acquiring U.S. Steel, albeit at a significantly reduced price compared to their previous offer. In light of President Biden’s public stance against the sale to Nippon Steel, Cleveland-Cliffs believes it is the only viable alternative for U.S. Steel.
Several companies made headlines in after-hours trading due to earnings reports and guidance updates. Nucor underwhelmed with its first-quarter results and cut its second-quarter outlook, sending its shares down 6.3%. Cleveland-Cliffs similarly missed estimates, resulting in a loss of nearly 3%. Cadence Design Systems’ lackluster second-quarter guidance dragged its shares down 8.9%. Meanwhile, Globe Life raised its full-year earnings guidance, leading to a 1.8% gain. Crane Company’s earnings and revenue beat, pushing its shares up 3.7%. Other movers included Alexandria Real Estate Equities, Packaging Corporation of America, Calix, Simpson Manufacturing, Medpace, and TrustCo Bank Corp. NY.
Cleveland-Cliffs reported weaker-than-expected first-quarter results due to a buyers’ strike from service centers. Although revenue slightly declined, the company’s adjusted earnings per share improved year-over-year. Steel product sales volumes decreased, but average selling prices increased. The company maintained its outlook for steel shipment volumes and unit cost reductions.
