Don't overlook NYSE:CLF—it's a hidden gem with strong fundamentals and an attractive price tag.

Last update: Feb 27, 2024

Take a closer look at CLEVELAND-CLIFFS INC (NYSE:CLF), a remarkable value stock uncovered by our stock screener. NYSE:CLF excels in fundamentals and maintains a very reasonable valuation. Let's break it down further.

Valuation Assessment of NYSE:CLF

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NYSE:CLF has achieved a 7 out of 10:

Compared to the rest of the industry, the Price/Earnings ratio of CLF indicates a somewhat cheap valuation: CLF is cheaper than 69.23% of the companies listed in the same industry.
CLF's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 25.81.
The Price/Forward Earnings ratio is 10.20, which indicates a very decent valuation of CLF.
CLF's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CLF is cheaper than 78.85% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of CLF to the average of the S&P500 Index (21.49), we can say CLF is valued rather cheaply.
Based on the Enterprise Value to EBITDA ratio, CLF is valued a bit cheaper than 68.59% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, CLF is valued cheaply inside the industry as 95.51% of the companies are valued more expensively.
CLF's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
CLF's earnings are expected to grow with 39.59% in the coming years. This may justify a more expensive valuation.

How do we evaluate the Profitability for NYSE:CLF?

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:CLF, the assigned 5 is noteworthy for profitability:

The Return On Assets of CLF (2.28%) is better than 64.74% of its industry peers.
CLF has a better Return On Equity (5.06%) than 67.31% of its industry peers.
CLF has a better Return On Invested Capital (4.25%) than 63.46% of its industry peers.
CLF had an Average Return On Invested Capital over the past 3 years of 11.26%. This is above the industry average of 8.80%.
The last Return On Invested Capital (4.25%) for CLF is well below the 3 year average (11.26%), which needs to be investigated, but indicates that CLF had better years and this may not be a problem.
With a decent Profit Margin value of 1.81%, CLF is doing good in the industry, outperforming 60.26% of the companies in the same industry.

Health Insights: NYSE:CLF

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:CLF, the assigned 5 reflects its health status:

CLF has a debt to FCF ratio of 2.07. This is a good value and a sign of high solvency as CLF would need 2.07 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 2.07, CLF belongs to the best of the industry, outperforming 83.33% of the companies in the same industry.
A Debt/Equity ratio of 0.42 indicates that CLF is not too dependend on debt financing.
Although CLF does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

Understanding NYSE:CLF's Growth Score

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:CLF has achieved a 5 out of 10:

Measured over the past years, CLF shows a very strong growth in Revenue. The Revenue has been growing by 56.65% on average per year.
The Earnings Per Share is expected to grow by 39.59% on average over the next years. This is a very strong growth
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Our latest full fundamental report of CLF contains the most current fundamental analsysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.