- Earnings estimates for Cleveland-Cliffs have been rising, increasing from $2.32 per share for 2021 roughly 90 days ago to $3.40 per share.
- With steel prices on a tear higher the past month, even these relatively recently revised earnings estimates are too low.
- The end result is that Cleveland-Cliffs' guidance of $3.5 billion in EBITDA for 2021, which was raised from $2 billion on March 30, is still too low.
- While earnings and EBITDA will normalize somewhat in 2022 and 2023, the risk is to the upside, as steel price strength casts its shadow farther than just 2021.
- With earnings, EBITDA, and free cash flows set to surge in a front-loaded fashion, this could provide a valuation floor, from which shares of Cleveland-Cliffs could advance further.
For further details see:
Cleveland-Cliffs: Estimates And Expectations Still Too Low