UPDATE: Bank of America Downgrades Cliffs Natural Resources to Neutral on Iron Ore Concerns

Bank of America reduces its rating on Cliffs Natural Resources

from Buy to Neutral and reduces its price target from $84 to $60. Bank of America comments, "We downgrade CLF to Neutral from Buy as we contemplate a more cautious outlook on iron ore. While much of potential excess supply and more modest demand seem priced into shares, we see limited upside amid likely further iron ore pressure. We are confident in CLF's ability to lower costs and add capacity but a weaker iron ore price trumps these accomplishments in our view. Sustained cash flow strength and a 5% dividend yield rest on a certain iron ore price, which may be at risk. Our new estimates use the forward curve at $120/t for 2013E iron ore vs a prior $140/t. We assume Chinese and global steel demand growth ~5%." CLF closed at $50.88 on Wednesday.