Market Overview

UPDATE: JP Morgan Upgrades Cliffs Natural Resources to Overweight on Discount to Peer Index

Share:
Related CLF
Earnings Scheduled For July 29, 2015
Mid-Morning Market Update: Markets Rise; Ford Beats Q2 Estimates
Cliffs Natural Resources (CLF) C. Lourenço Gonçalves on Q2 2015 Results - Earnings Call Transcript (Seeking Alpha)

JP Morgan upgraded Cliffs Natural Resources (NYSE: CLF) from Neutral to Overweight and raised the price target from $35.00 to $40.00.

JP Morgan commented, "Since mid-September 2012, Cliffs' peer group is up 17% on average while CLF is down 37% despite a 53% rise in seaborne spot iron ore prices – the current discount between Cliffs' stock price and iron ore prices is now at the widest spread on record. We attribute this substantial relative underperformance to persistent disappointments at Bloom Lake presented to the market piecemeal over the last two years, ultimately culminating in a 20% write-down on the initial $5B purchase price, a threefold increase in Phase II capex, and a 76% dividend cut. … In our view, Cliffs' shares reflect this series of negative events and are only pricing in $110/tonne iron ore in 2015, 29% lower than current spot prices, based on the stock's average EV/EBITDA multiple of 5.6x

Cliffs Natural Resources closed at $28.85 on Friday.

Latest Ratings for CLF

DateFirmActionFromTo
Apr 2015CitigroupMaintainsSell
Apr 2015CitigroupMaintainsSell
Apr 2015CitigroupMaintainsSell

View More Analyst Ratings for CLF
View the Latest Analyst Ratings

Posted-In: JP MorganAnalyst Color Upgrades Analyst Ratings

 

Related Articles (CLF)

Get Benzinga's Newsletters