Cleveland-Cliffs Stock Earns Two Upgrades After Strong Q3 EBITDA Forecast

Shares of Cleveland-Cliffs (NYSE:CLF) have gained 27% in the past month after the company's strong third-quarter outlook prompted two separate analyst upgrades last week, overshadowing a narrow miss on second-quarter earnings per share.

Guidance Sparks Re-Rating

In its earnings report on July 23, 2026, Cleveland-Cliffs reported a Q2 EPS loss of -$0.20, missing consensus estimates by one cent. However, investors and analysts focused on the company's operational performance and forward-looking guidance.

Key figures from the report included:

• Q2 Adjusted EBITDA: $286 million, a threefold increase from the $95 million reported in the first quarter.
• Q3 Adjusted EBITDA Guidance: Approximately $575 million, a figure well above prevailing Wall Street forecasts.
• Free Cash Flow: The company generated positive free cash flow for the first time in two years.

The robust Q3 guidance was the primary catalyst for the stock's re-rating. In response, BNP Paribas Exane upgraded its rating on the stock to Neutral from Underperform, while GLJ Research moved its rating to Buy from Hold.

Diverging Analyst Views

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The two upgrades reflect different levels of conviction. BNP Paribas Exane set a price target of $11.50, noting that the strong guidance removed its previous bear case. GLJ Research issued a more bullish call, setting a price target of $15.60.

GLJ's thesis is based on expectations that significantly exceed the market consensus. The firm projects Cleveland-Cliffs' 2026 adjusted EBITDA will reach $1.74 billion, which is 17% higher than the Street's consensus estimate of $1.49 billion. This contrasts with more cautious stances from other firms; Barclays maintained its Underweight rating with a $10 target, while JPMorgan remained Neutral, though it raised its target to $11 from $10.

Operational Tailwinds

Analysts upgrading the stock point to several underlying structural drivers supporting an improved outlook. These include the full price realization from higher steel prices, which has yet to flow through the company's contract book. Management also guided for a $10 per ton cost reduction following recent outages and reiterated its full-year shipment guidance of 16.5 to 17.0 million net tons.

Adding to management confidence, the company announced that CFO Celso Goncalves was promoted to President, signaling a deliberate leadership transition.