Cleveland-Cliffs Inc. CLF is slated to release fourth-quarter 2024 results after the closing bell on Feb. 24.

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CLF has a trailing four-quarter earnings surprise of roughly 5.6%, on average. While CLF is expected to have benefited from actions to lower costs, reduced steel prices and weaker volumes are likely to have weighed on its performance in the fourth quarter.

The CLF stock has lost 38.7% in a year’s time compared with the Zacks Mining – Miscellaneous industry’s 5.3% decline.

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Let’s see how things are shaping up for the upcoming announcement.

What Do CLF’s Revenue Estimates Say?

The Zacks Consensus Estimate for fourth-quarter consolidated revenues for Cleveland-Cliffs is currently pegged at $4,313.4 million, which suggests a year-over-year decline of 15.6%.

Factors to Watch For CLF Stock

CLF is expected to have faced headwinds from weaker U.S. steel prices in the fourth quarter. U.S. steel prices declined sharply in 2024 due to a slowdown in end-market demand and oversupply after a strong run in late 2023 that extended into early 2024. The benchmark hot-rolled coil (HRC) prices tumbled more than 40% last year from $1,200 per short ton at the start of 2024. The downside has been influenced by a concoction of factors, including a pullback in steel mill lead times, an oversupply of steel exacerbated by increased imports, reduced demand from key industries and economic uncertainties.  Sluggish industrial production and construction activities also contributed to the decline.

Weaker selling prices are likely to have impacted CLF’s performance in the quarter to be reported. Our estimate for the average net selling price per net ton of steel products is $985, indicating a roughly 10% year-over-year decrease. 

Subdued demand in the automotive sector is expected to have weighed on the company’s total volumes in the December quarter. Our estimate for external sales volumes for steel products stands at 3.81 million net tons, suggesting a 5.5% year-over-year decline. 

Nevertheless, Cleveland-Cliffs is expected to have benefited from actions to lower steelmaking unit costs in the fourth quarter. Lower costs are expected to have supported its margins.

On Nov. 1, 2024, the company closed the acquisition of Stelco Holdings Inc. Its fourth-quarter results are expected to reflect the contributions of the acquisition.

Cleveland-Cliffs Inc. Price and EPS Surprise

Cleveland-Cliffs Inc. price-eps-surprise | Cleveland-Cliffs Inc. Quote

What Our Model Unveils for CLF

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 CLF is -2.80%. The Zacks Consensus Estimate for earnings for the fourth quarter is currently pegged at a loss of 64 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: CLF currently carries a Zacks Rank #5 (Strong Sell).

Stocks That Warrant a Look

Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:

Ashtead Group plc ASHTY, slated to release fiscal third-quarter earnings on March 4, has an Earnings ESP of +11.11% and carries a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus mark for ASHTY’s third-quarter earnings is currently pegged at $3.47.

TriMas Corporation TRS, slated to release fourth-quarter earnings on Feb. 27, has an Earnings ESP of +1.05% and carries a Zacks Rank #3 at present.

The consensus mark for TRS’ fourth-quarter earnings is currently pegged at 48 cents.

Greif, Inc. GEF, scheduled to release fiscal first-quarter earnings on Feb. 26, has an Earnings ESP of +2.60%.

The Zacks Consensus Estimate for Greif’s earnings for the first quarter is currently pegged at 72 cents. GEF currently carries a Zacks Rank #3.

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Cleveland-Cliffs Inc. (CLF) : Free Stock Analysis Report

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