Cleveland-Cliffs Target of Unusually Large Options Trading (NYSE:CLF)

Key Points

• Unusually heavy call options activity hit Cleveland-Cliffs, with investors buying 86,150 call contracts on Thursday — about 77% above its average daily volume.
• The stock rose to $11.13 on strong trading volume, and the company recently reported quarterly results that beat estimates on both EPS and revenue, with revenue up 5.9% year over year.
• Wall Street remains cautious: analysts’ overall view is “Reduce” with an average price target of $11.50, while recent insider selling and mixed analyst ratings have kept sentiment restrained.

Cleveland-Cliffs Inc. (NYSE:CLF - Get Free Report) was the recipient of some unusual options trading activity on Thursday. Investors acquired 86,150 call options on the company. This represents an increase of approximately 77% compared to the average daily volume of 48,730 call options.

Cleveland-Cliffs Stock Performance

NYSE CLF traded up $1.68 during trading hours on Thursday, hitting $11.13. 26,635,010 shares of the stock were exchanged, compared to its average volume of 18,565,545. The company has a quick ratio of 0.64, a current ratio of 2.02 and a debt-to-equity ratio of 1.29. The company has a market cap of $6.35 billion, a price-to-earnings ratio of -4.75 and a beta of 2.13. Cleveland-Cliffs has a 12-month low of $7.73 and a 12-month high of $16.70. The stock has a 50-day moving average of $11.25 and a 200 day moving average of $11.04.

Cleveland-Cliffs (NYSE:CLF - Get Free Report) last released its earnings results on Thursday, July 23rd. The mining company reported ($0.20) earnings per share (EPS) for the quarter, topping the consensus estimate of ($0.21) by $0.01. The company had revenue of $5.23 billion for the quarter, compared to analysts' expectations of $5.15 billion. Cleveland-Cliffs had a negative return on equity of 15.48% and a negative net margin of 6.42%.The firm's quarterly revenue was up 5.9% on a year-over-year basis. During the same quarter in the previous year, the firm posted ($0.50) EPS. As a group, equities research analysts forecast that Cleveland-Cliffs will post -0.18 earnings per share for the current year.

Wall Street Analyst Weigh In

Several analysts have recently issued reports on the company. Morgan Stanley reiterated an "equal weight" rating and issued a $12.50 price objective (up from $12.00) on shares of Cleveland-Cliffs in a research note on Monday, June 22nd. Citigroup reduced their price target on Cleveland-Cliffs from $11.00 to $10.00 and set a "neutral" rating on the stock in a research report on Tuesday, July 7th. Weiss Ratings reiterated a "sell (d-)" rating on shares of Cleveland-Cliffs in a research note on Friday, April 24th. KeyCorp began coverage on Cleveland-Cliffs in a research report on Wednesday, March 25th. They set a "sector weight" rating for the company. Finally, Bank of America cut their target price on shares of Cleveland-Cliffs from $14.00 to $11.50 and set a "neutral" rating on the stock in a research note on Thursday, July 9th. Nine investment analysts have rated the stock with a Hold rating and two have issued a Sell rating to the company. According to data from MarketBeat.com, Cleveland-Cliffs currently has an average rating of "Reduce" and an average price target of $11.50.

Insider Buying and Selling at Cleveland-Cliffs

In related news, EVP Celso L. Goncalves, Jr. sold 214,308 shares of the company's stock in a transaction that occurred on Friday, June 5th. The shares were sold at an average price of $13.41, for a total transaction of $2,873,870.28. Following the sale, the executive vice president directly owned 184,542 shares of the company's stock, valued at $2,474,708.22. This represents a 53.73% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Company insiders own 0.95% of the company's stock.

Hedge Funds Weigh In On Cleveland-Cliffs

A number of large investors have recently made changes to their positions in the stock. Assenagon Asset Management S.A. lifted its stake in shares of Cleveland-Cliffs by 208.2% in the second quarter. Assenagon Asset Management S.A. now owns 6,021,829 shares of the mining company's stock valued at $56,545,000 after purchasing an additional 4,067,994 shares during the period. GAMMA Investing LLC lifted its holdings in shares of Cleveland-Cliffs by 60.0% in the second quarter. GAMMA Investing LLC now owns 12,149 shares of the mining company's stock valued at $114,000 after purchasing an additional 4,557 shares in the last quarter. Moody National Bank Trust Division acquired a new stake in shares of Cleveland-Cliffs in the second quarter valued at approximately $545,000. Versant Capital Management Inc increased its stake in shares of Cleveland-Cliffs by 24.3% during the 2nd quarter. Versant Capital Management Inc now owns 8,243 shares of the mining company's stock worth $77,000 after purchasing an additional 1,614 shares in the last quarter. Finally, NewEdge Advisors LLC raised its position in shares of Cleveland-Cliffs by 25.2% during the 1st quarter. NewEdge Advisors LLC now owns 123,427 shares of the mining company's stock worth $1,043,000 after purchasing an additional 24,868 shares during the last quarter. Hedge funds and other institutional investors own 67.68% of the company's stock.

Trending Headlines about Cleveland-Cliffs

Here are the key news stories impacting Cleveland-Cliffs this week:

• Positive Sentiment: Cleveland-Cliffs reported second-quarter revenue of about $5.23 billion, topping estimates and rising year over year, while adjusted EPS of a $0.20 loss narrowly beat expectations. Cleveland-Cliffs (CLF) Reports Q2 Loss, Tops Revenue Estimates
• Positive Sentiment: The company’s outlook for the third quarter was stronger than expected, with investors focusing on improving profitability and management’s forecast for a meaningful increase in EBITDA. Cleveland-Cliffs shares jump as upbeat third-quarter forecast outweighs earnings miss NYSE: CLF
• Positive Sentiment: The board promoted CFO Celso Goncalves to President and CFO and added him to the board, a sign of leadership continuity and confidence in the company’s strategy. Cleveland-Cliffs Announces Promotion of Chief Financial Officer Celso Goncalves from Executive Vice President to President and Appointment to Board of Directors

Cleveland-Cliffs Company Profile

Cleveland-Cliffs Inc is a leading North American producer of iron ore pellets and flat-rolled steel products. Tracing its roots to 1847, the company has evolved from an iron-ore mining concern in the Great Lakes region into a fully integrated steelmaker. Today, Cleveland-Cliffs operates iron ore mining complexes in Michigan and Minnesota as well as steelmaking and finishing facilities across the United States.

The company's integrated platform begins with direct control of key raw materials, including iron ore and scrap, and extends through every stage of steel production.

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