Cleveland-Cliffs (CLF) Stock Forecast & Price Target

Cleveland-Cliffs is expected to benefit from a potential partnership with POSCO, which could improve their liquidity and reduce fixed costs. Along with a favorable steel cycle, positive momentum, and potential upside in pricing, the company's decision to increase auto volumes and shift to higher-value flat-rolled products is expected to positively impact their financials. However, possible negative inflection in the steel cycle, short positioning from investors waiting on the sidelines, and potential equity raise post-deal may impact the company's share price. Cleveland-Cliffs has also recently pursued an equity raise and redeemed some of its notes, resulting in a pro-forma diluted share count of 570MM. While there might be a decline in ASPs in the short term, the company is expected to see improvements in ASPs due to a positive mix shift away from slabs and improved pricing in Canada, resulting in an overall increase in ASPs for 2026.

Cleveland-Cliffs is a flat-rolled steel producer and manufacturer of iron ore pellets in North America. Although the company serves a diverse range of markets, the majority of its revenue comes from the United States. However, the company is facing challenges such as low utilization rates, increasing supply, and competition in the steel industry. Additionally, the recent guidance from the company implies downside risk to 2026 earnings compared to analyst estimates, which could impact the stock's performance. Moreover, the recent price war in the industry could lower the company's pricing power and adversely affect its financials. Therefore, based on these factors, the financial analyst holds a negative outlook on Cleveland-Cliffs's stock.