In a report released today, Carlos De Alba from Morgan Stanley maintained a Hold rating on Cleveland-Cliffs (CLF – Research Report), with a price target of $11.00.
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Carlos De Alba has given his Hold rating due to a combination of factors influencing Cleveland-Cliffs’ current market position. The company has successfully transitioned from an iron ore miner to a leading integrated steelmaker in North America through strategic acquisitions, including AK Steel and ArcelorMittal USA. Despite these advancements, the anticipated decline in auto steel demand and the company’s focus on using free cash flow to reduce debt rather than return it to shareholders contribute to a cautious outlook.
Carlos De Alba’s analysis also reflects updated cost assumptions, leading to a revised EBITDA forecast. The expectation of a negative EBITDA in the first quarter of 2025 and a slight decrease in the annual forecast for 2025 further supports the decision to maintain a Hold rating. These elements suggest that while Cleveland-Cliffs is making strategic moves, external market conditions and financial priorities temper the potential for immediate stock appreciation.
De Alba covers the Basic Materials sector, focusing on stocks such as Teck Resources, Freeport-McMoRan, and Cleveland-Cliffs. According to TipRanks, De Alba has an average return of 12.4% and a 49.49% success rate on recommended stocks.