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The company beat the Zacks Consensus Estimate for earnings in three of the last four quarters, while posted in-line result once. It has a trailing four-quarter earnings surprise of roughly 19.9%, on average.
Cleveland-Cliffs is likely to have gained from healthy overall volumes and lower steelmaking unit costs in the fourth quarter. However, weaker selling prices are likely to have hurt its margins.
The stock has lost 13.1% in a year’s time compared with the industry’s 9.9% 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 $5,161.9 million, which suggests a year-over-year rise of 2.3%.
Some Factors to Watch For
The company is likely to have witnessed lower sales volumes in the automotive market in the fourth quarter due to the outages caused by the United Auto Workers (UAW) strike. However, healthy overall demand in its end markets is likely to have supported its total volumes in the quarter. Our estimate for external sales volumes for steel products stands at 4.023 million net tons, suggesting a 4.8% year-over-year rise.
Cleveland-Cliffs is also expected to have benefited from actions to lower unit costs. Lower steelmaking unit costs are likely to have supported margins in the fourth quarter. The company, in its third-quarter call, said that it anticipates achieving an additional $15 per net ton reduction in steel unit costs on a sequential comparison basis in the fourth quarter.
Meanwhile, U.S. steel prices rebounded during the fourth quarter with the benchmark hot-rolled coil (HRC) prices breaking above $1,000 per short ton in December, driven by U.S. steel mills’ price hike actions, supply tightness and a recovery in demand. The recovery is also being supported by the resolution to the UAW strike. Notably, the UAW reached a deal with the Detroit Big Three in November 2023, ending the roughly six-week strike that weighed on the U.S. steel industry due to a slowdown in automotive demand.
Despite the recovery in HRC prices, sequentially weaker average selling prices are likely to have impacted the company’s performance in the quarter to be reported.
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 -20.00%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at a loss of 7 cents. 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 #2.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
The consensus estimate for CF’s earnings for the fourth quarter is currently pegged at $1.56.
Agnico Eagle Mines Limited (AEM - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +11.96% and carries a Zacks Rank #3 at present.
The consensus mark for AEM’s fourth-quarter earnings is currently pegged at 46 cents.
Kinross Gold Corporation (KGC - Free Report) , scheduled to release fourth-quarter earnings on Feb 14, has an Earnings ESP of +25.00%.
The Zacks Consensus Estimate for Kinross' earnings for the fourth quarter is currently pegged at 9 cents. KGC currently carries a Zacks Rank #3.
Image: Bigstock
Cleveland-Cliffs (CLF) to Report Q4 Earnings: What's in Store?
Cleveland-Cliffs Inc. (CLF - Free Report) is slated to release fourth-quarter 2023 results after the closing bell on Jan 29.
The company beat the Zacks Consensus Estimate for earnings in three of the last four quarters, while posted in-line result once. It has a trailing four-quarter earnings surprise of roughly 19.9%, on average.
Cleveland-Cliffs is likely to have gained from healthy overall volumes and lower steelmaking unit costs in the fourth quarter. However, weaker selling prices are likely to have hurt its margins.
The stock has lost 13.1% in a year’s time compared with the industry’s 9.9% 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 $5,161.9 million, which suggests a year-over-year rise of 2.3%.
Some Factors to Watch For
The company is likely to have witnessed lower sales volumes in the automotive market in the fourth quarter due to the outages caused by the United Auto Workers (UAW) strike. However, healthy overall demand in its end markets is likely to have supported its total volumes in the quarter. Our estimate for external sales volumes for steel products stands at 4.023 million net tons, suggesting a 4.8% year-over-year rise.
Cleveland-Cliffs is also expected to have benefited from actions to lower unit costs. Lower steelmaking unit costs are likely to have supported margins in the fourth quarter. The company, in its third-quarter call, said that it anticipates achieving an additional $15 per net ton reduction in steel unit costs on a sequential comparison basis in the fourth quarter.
Meanwhile, U.S. steel prices rebounded during the fourth quarter with the benchmark hot-rolled coil (HRC) prices breaking above $1,000 per short ton in December, driven by U.S. steel mills’ price hike actions, supply tightness and a recovery in demand. The recovery is also being supported by the resolution to the UAW strike. Notably, the UAW reached a deal with the Detroit Big Three in November 2023, ending the roughly six-week strike that weighed on the U.S. steel industry due to a slowdown in automotive demand.
Despite the recovery in HRC prices, sequentially weaker average selling prices are likely to have impacted the company’s performance in the quarter to be reported.
Cleveland-Cliffs Inc. Price and EPS Surprise
Cleveland-Cliffs Inc. price-eps-surprise | Cleveland-Cliffs 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 -20.00%. The Zacks Consensus Estimate for the fourth quarter is currently pegged at a loss of 7 cents. 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 #2.
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
CF Industries Holdings, Inc. (CF - Free Report) , scheduled to release earnings on Feb 14, has an Earnings ESP of +1.26% and carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for CF’s earnings for the fourth quarter is currently pegged at $1.56.
Agnico Eagle Mines Limited (AEM - Free Report) , slated to release earnings on Feb 15, has an Earnings ESP of +11.96% and carries a Zacks Rank #3 at present.
The consensus mark for AEM’s fourth-quarter earnings is currently pegged at 46 cents.
Kinross Gold Corporation (KGC - Free Report) , scheduled to release fourth-quarter earnings on Feb 14, has an Earnings ESP of +25.00%.
The Zacks Consensus Estimate for Kinross' earnings for the fourth quarter is currently pegged at 9 cents. KGC currently carries a Zacks Rank #3.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.