Street Calls of the Week
CLEVELAND - Cleveland-Cliffs Inc. (NYSE:CLF), with a market capitalization of $5.32 billion and existing total debt of $7.75 billion, announced Wednesday its intention to offer $600 million in Senior Unsecured Guaranteed Notes due 2034, subject to market conditions. According to InvestingPro analysis, the company currently operates with a significant debt burden while maintaining a healthy current ratio of 2.04.
The steel producer plans to use the proceeds, along with available liquidity, to redeem all of its outstanding 5.875% Senior Guaranteed Notes due 2027, 7.00% Senior Guaranteed Notes due 2027, and AK Steel 7.00% Senior Notes due 2027.
The new notes will be guaranteed on a senior unsecured basis by Cleveland-Cliffs’ material direct and indirect wholly-owned domestic subsidiaries, with certain exclusions.
The offering is exempt from Securities Act registration requirements and will be available only to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S. The notes have not been registered under the Securities Act or applicable state securities laws.
Cleveland-Cliffs describes itself as a leading North America-based steel producer focused on value-added sheet products, particularly for the automotive industry. The company operates with vertical integration from iron ore mining through steel production and downstream processing. With annual revenue of $18.46 billion, the company is currently facing profitability challenges, as revealed in InvestingPro’s comprehensive analysis, which includes 8 additional key financial insights available to subscribers. Headquartered in Cleveland, Ohio, the company employs approximately 30,000 people across operations in the United States and Canada.
This information is based on a press release statement from the company.
In other recent news, Cleveland-Cliffs Inc. has been in the spotlight with several notable developments. The U.S. Department of Commerce has imposed 50% tariffs on certain steel derivative products, a move supported by Cleveland-Cliffs to address tariff circumvention involving steel processed through Mexico and Canada. Additionally, the company has secured multiyear fixed-price contracts with multiple U.S. automakers, marking a shift from its usual one-year agreements. These contracts are expected to provide stability in revenue for the company over the next few years.
Analyst actions have also been noteworthy, with KeyBanc upgrading Cleveland-Cliffs’ stock rating to Overweight, citing improved cost and efficiency performance. Meanwhile, Wells Fargo initiated coverage with an Equal Weight rating, supported by a favorable near-term sheet price view and a richer product mix. These analyst perspectives suggest varying expectations for the company’s future performance. These recent developments reflect the dynamic environment in which Cleveland-Cliffs is operating.
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