Market Overview

UPDATE: Deutsche Bank Downgrades Cliffs Natural Resources to Hold, Lowers PT on Adjusted EPS

Share:
Related CLF
Mid-Day Market Update: Juno Therapeutics Jumps Following Announcement of 10-Year Collaboration With Celgene
Mid-Morning Market Update: Markets Rise; ConAgra Foods Plans To Exit Private Label Business
Go short Cliffs Natural, Fortescue Metals, analyst says (Seeking Alpha)

In a report published Wednesday, Deutsche Bank downgraded its rating on Cliffs Natural Resources (NYSE: CLF) from Buy to Hold, and lowered its price target from $48.00 to $38.00.

Deutsche Bank noted, “Cliffs 4Q12 adj. dil. EPS of $0.62 ahead of both DBe of $0.54 and FactSet consensus of $0.51, but EBITDA of $254m was lower than DBe of $308m (lower iron ore volumes and prices / higher costs). Headline EPS loss of $11.36 on previously announced non-cash charges. Downgrading to Hold (from Buy) and cutting our PT to $38 ($48) on estimated 19-21% dilution from unexpected share issuance (shares + mandatory convertible preferred) of 27-30m shares (including over-allotment), raising $885-940m (assuming $30-35 share price). Though BS position to improve, we question timing of issuance as 2013 cash flow generation likely to increase and after dividend cut by ~75% to $0.60 (from $2.50).”

Cliffs Natural Resources closed on Tuesday at $36.61.

Latest Ratings for CLF

DateFirmActionFromTo
Apr 2015CitigroupMaintainsSell
Apr 2015CitigroupMaintainsSell
Apr 2015CitigroupMaintainsSell

View More Analyst Ratings for CLF
View the Latest Analyst Ratings

Posted-In: Deutsche BankAnalyst Color Downgrades Analyst Ratings

 

Related Articles (CLF)

Around the Web, We're Loving...

Get Benzinga's Newsletters