Story
Cleveland-Cliffs Stock Extends Gains on Strong Outlook and Analyst Upgrade
Summary
Shares of the steel producer are rallying for a second day, fueled by third-quarter guidance that significantly beat Wall Street estimates and a rating upgrade from BNP Paribas Exane.
Shares of Cleveland-Cliffs Inc. (NYSE: CLF) continued their upward momentum Friday, rising nearly 6.9% in morning trading to $11.72. The rally builds on a post-earnings surge, driven by the company's robust third-quarter forecast and a fresh analyst upgrade.
Blowout Guidance Fuels Investor Confidence
The primary catalyst for the stock's move was the steelmaker's second-quarter financial results and, more significantly, its forward guidance. Key highlights from the report include:
- Q3 Adjusted EBITDA Guidance: The company projects approximately $575 million for the third quarter, a figure that came in well above analyst consensus.
- Q2 Performance: Cleveland-Cliffs reported Q2 adjusted EBITDA of $286 million, a threefold increase from the $95 million posted in the first quarter.
- Free Cash Flow: The company returned to positive free cash flow, marking a critical financial inflection point after two years of cash burn.
Management also reinforced its operational outlook by reiterating its full-year 2026 steel shipment guidance of 16.5 to 17.0 million net tons.
Analyst Upgrade and Leadership Changes
AdAdding to the positive sentiment, BNP Paribas Exane upgraded its rating on Cleveland-Cliffs to Neutral from Underperform on Friday, setting a price target of $11.50. The upgrade provided a fresh institutional endorsement following the strong earnings report.
Cleveland-Cliffs also announced the promotion of Chief Financial Officer Celso Goncalves to the role of President and appointed him to the Board of Directors. Investors have interpreted the move as a signal of stability and continued execution of the company's strategy.
Market Context
The steel producer's gains come amid a mixed session for the broader market, with the S&P 500 trading flat while the Nasdaq Composite edged lower. The market action suggests a potential rotation by investors into industrial stocks with strong fundamental catalysts, following a technology-led selloff on Thursday.
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