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Cleveland-Cliffs (CLF) to Post Q4 Earnings: What's in the Offing?
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Cleveland-Cliffs Inc. (CLF - Free Report) is slated to release fourth-quarter 2021 results before the opening bell on Feb 11. Benefits of higher year-over-year steel prices and contributions of AK Steel and ArcelorMittal USA acquisitions are likely to get reflected on the company’s performance.
The company’s earnings beat the Zacks Consensus Estimate in two of the last four quarters, while missed twice. It has a trailing four-quarter negative earnings surprise of roughly 1.28%, on average. The company posted an earnings surprise of around 4.5% in the last reported quarter.
The stock has gained 9.7% in a year’s time compared with the industry’s 6.1% decline.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for the upcoming announcement.
What do the Estimates Say?
The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Cleveland-Cliffs is currently pegged at $5,419 million, which calls for a rise of 140.2% year over year.
Some Factors at Play
Cleveland-Cliffs is expected to have gained from its acquisitions of AK Steel and ArcelorMittal USA, which might have had a positive impact on its fourth-quarter revenues and earnings. It is also expected to have benefited from strong end-market demand for steel.
Higher year-over-year steel prices are also likely to have aided its performance in the fourth quarter. U.S. steel prices witnessed a significant rally in 2021 supported by strong underlying supply and demand fundamentals. However, prices have come under pressure since the beginning of the fourth quarter of 2021, partly due to rising production levels.
The benchmark hot-rolled coil (“HRC”) prices have cooled off since October after peaking in September 2021, dragged down by shorter lead times and rising supply. Despite the sharp correction from its peak levels, HRC prices remain elevated, and are well above the year-ago levels. Higher domestic steel prices are likely to have boosted Cleveland-Cliffs’ margins in the quarter to be reported.
However, Cleveland-Cliffs is likely to have faced some headwinds from maintenance outages in the December quarter. These outages are expected to have affected the company’s production in the quarter. Higher labor and natural gas costs are also likely to have impacted its results.
Our proven model does not conclusively predict an earnings beat for Cleveland-Cliffs this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Cleveland-Cliffs is -2.72%. The Zacks Consensus Estimate for earnings for the fourth quarter is currently pegged at $2.03. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Cleveland-Cliffs currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
The Zacks Consensus Estimate for Huntsman's fourth-quarter earnings has been revised 4.1% upward over the past 60 days. The consensus estimate for HUN’s earnings for the quarter is currently pegged at 88 cents.
CF Industries Holdings, Inc. (CF - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +7.88% and carries a Zacks Rank #3.
The consensus estimate for CF Industries' fourth-quarter earnings has been revised 46.4% upward over the past 60 days. The Zacks Consensus Estimate for CF’s earnings for the quarter stands at $3.41.
Nutrien Ltd. (NTR - Free Report) , scheduled to release earnings on Feb 16, has an Earnings ESP of +1.23% and sports a Zacks Rank #1.
The Zacks Consensus Estimate for Nutrien's fourth-quarter earnings has been revised 0.9% upward over the past 60 days. The consensus estimate for NTR’s earnings for the quarter is currently pegged at $2.30.
Image: Bigstock
Cleveland-Cliffs (CLF) to Post Q4 Earnings: What's in the Offing?
Cleveland-Cliffs Inc. (CLF - Free Report) is slated to release fourth-quarter 2021 results before the opening bell on Feb 11. Benefits of higher year-over-year steel prices and contributions of AK Steel and ArcelorMittal USA acquisitions are likely to get reflected on the company’s performance.
The company’s earnings beat the Zacks Consensus Estimate in two of the last four quarters, while missed twice. It has a trailing four-quarter negative earnings surprise of roughly 1.28%, on average. The company posted an earnings surprise of around 4.5% in the last reported quarter.
The stock has gained 9.7% in a year’s time compared with the industry’s 6.1% decline.
Let’s see how things are shaping up for the upcoming announcement.
What do the Estimates Say?
The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Cleveland-Cliffs is currently pegged at $5,419 million, which calls for a rise of 140.2% year over year.
Some Factors at Play
Cleveland-Cliffs is expected to have gained from its acquisitions of AK Steel and ArcelorMittal USA, which might have had a positive impact on its fourth-quarter revenues and earnings. It is also expected to have benefited from strong end-market demand for steel.
Higher year-over-year steel prices are also likely to have aided its performance in the fourth quarter. U.S. steel prices witnessed a significant rally in 2021 supported by strong underlying supply and demand fundamentals. However, prices have come under pressure since the beginning of the fourth quarter of 2021, partly due to rising production levels.
The benchmark hot-rolled coil (“HRC”) prices have cooled off since October after peaking in September 2021, dragged down by shorter lead times and rising supply. Despite the sharp correction from its peak levels, HRC prices remain elevated, and are well above the year-ago levels. Higher domestic steel prices are likely to have boosted Cleveland-Cliffs’ margins in the quarter to be reported.
However, Cleveland-Cliffs is likely to have faced some headwinds from maintenance outages in the December quarter. These outages are expected to have affected the company’s production in the quarter. Higher labor and natural gas costs are also likely to have impacted its results.
ClevelandCliffs Inc. Price and EPS Surprise
ClevelandCliffs Inc. price-eps-surprise | ClevelandCliffs Inc. Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Cleveland-Cliffs this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Cleveland-Cliffs is -2.72%. The Zacks Consensus Estimate for earnings for the fourth quarter is currently pegged at $2.03. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Cleveland-Cliffs currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows these have the right combination of elements to post an earnings beat this quarter:
Huntsman Corporation (HUN - Free Report) , scheduled to release earnings on Feb 15, has an Earnings ESP of +0.09% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Huntsman's fourth-quarter earnings has been revised 4.1% upward over the past 60 days. The consensus estimate for HUN’s earnings for the quarter is currently pegged at 88 cents.
CF Industries Holdings, Inc. (CF - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +7.88% and carries a Zacks Rank #3.
The consensus estimate for CF Industries' fourth-quarter earnings has been revised 46.4% upward over the past 60 days. The Zacks Consensus Estimate for CF’s earnings for the quarter stands at $3.41.
Nutrien Ltd. (NTR - Free Report) , scheduled to release earnings on Feb 16, has an Earnings ESP of +1.23% and sports a Zacks Rank #1.
The Zacks Consensus Estimate for Nutrien's fourth-quarter earnings has been revised 0.9% upward over the past 60 days. The consensus estimate for NTR’s earnings for the quarter is currently pegged at $2.30.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.