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CLF Stock: A Buy or a Bust?

JACK KELLOGG•UPDATED JUN. 11, 2025, 5:03 PM ET
Reviewed by Tim Sykesand Fact-checked by Ellis Hobbs

Cleveland-Cliffs Inc. stock traded down by -8.35% following investor reactions to major production expansion delays.

Highs, Lows and the Future:

  • A recent investigation into potential securities fraud and unexpected financial losses, including a 15.7% plunge in share price, has placed Cleveland-Cliffs under scrutiny.
  • Analysts have lowered their ratings and price targets for Cleveland-Cliffs, amidst concerns of declining revenues and idled plants.
  • Talks between the US and Mexico regarding steel tariffs could potentially reshape Cleveland-Cliffs’ market opportunities in the near future.
  • Legal firms are diving into alleged federal securities law violations as Cleveland-Cliffs reports bigger-than-expected losses.
  • A series of downgraded analyst ratings and ongoing investigations contribute to volatile stock movements for Cleveland-Cliffs.

Candlestick Chart

Live Update At 17:02:59 EST: On Wednesday, June 11, 2025 Cleveland-Cliffs Inc. stock [NYSE: CLF] is trending down by -8.35%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Understanding Cleveland-Cliffs’ Financial Tumult:

As millionaire penny stock trader and teacher Tim Sykes, says, “There is always another play around the corner; don’t chase just because you feel FOMO.” This lesson is vital for traders who often scramble to jump on hot stock tips without considering the consequences. It’s essential for traders to remember that patience and strategy are key to success, rather than acting on the fear of missing out.

Cleveland-Cliffs Inc., a major player in the steel industry, finds itself at the crossroads of market hesitations and regulatory investigations. Not only is the firm’s recent financial performance lackluster, it’s also ensnared in complex legal inquiries. Here’s what we know: Cleveland-Cliffs revealed some surprising losses and a notable revenue drop. A whopping 11% dip year-over-year has set off alarms for investors. These financial figures have coincided with announcements to shut down six steel plants, stirring apprehensions about future revenue streams.

The decision to idle these plants could be seen as a drastic move meant to curb operational expenses. But to seasoned observers, it signals a potential struggle in maintaining production capacity amid financial strain.

More Breaking News

To add salt to the wound, several law firms have launched investigations over alleged wrongdoings. With accusations of securities violations hanging over the company’s head, investors are left with more questions than answers.

A Closer Look at the Ratios and Reports:

Glancing at Cleveland-Cliffs’ key ratios, the situation becomes more obvious. Their EBIT margin stands in stark contrast at -8% and the EBITDA margin is -2.6%, painting a rather bleak financial picture. One can’t ignore the mammoth -6.04% net profit margin, underlining the daunting path that lies ahead.

Unpacking their valuation metrics, the picture doesn’t brighten considerably. With a pricetobook ratio of 0.63, there’s a gap between perceived value and the tangible assets backing it up. More troubling is their balance sheet featuring an undeniable long-term debt of $7.6 billion, serving as a towering testimony to fiscal challenges.

Yet, amidst these skulls of financial storm, the quick and current ratios show a semblance of stability at 0.5 and 2.1. These figures hint at the ability to handle short-term liabilities, albeit on precipitous terms. Cleveland-Cliffs boasts a total asset base worth $20.8 billion, although it’s overshadowed by hefty liabilities.

Given these numbers, skepticism encompasses their potential for a financial rebound. The company is expected to carry the weight of massive debt while simultaneously eking out operational survival amidst an ever-changing steel market.

Confluence of News and Market Movement:

The swirl of news around Cleveland-Cliffs Inc. casts a foreboding aura over its stock pricing. One can’t help but notice the flurry of analyst downgrades. They underscore a prevalent bearish sentiment. Jefferies slashed its rating from Buy to Hold, echoing similar sentiments echoed by Citigroup. A recurring lower price target is snapping confidence among investors looking for indicators of value. Amidst this chorus of downgrades lies the story told in regulatory probes.

Legal firms scrutinize the company for potential misconduct, shedding light upon a battle of transparency. Pomerantz, Kirby McInerney LLP, and others have raised alarms over Cleveland-Cliffs’ apparent violations of federal securities laws, keeping investors wary of impending court-related repercussions. In moments like these, history teaches us that protraction ensues, and so does uncertainty in investor sentiment.

As of now, the market reacts as one would expect– turbulent, volatile. But under these clouds of gloom lies a prospect of opportunity. Particularly for those inclined towards high-risk, high-reward scenarios. Any hint of legal resolution or restructuring success could propel Cleveland-Cliffs back onto a more positive trajectory.

The Marketplace and Steel Tariffs:

On the horizon, the dialogue surrounding US-Mexico steel tariffs catches attention. Both nations eye removing existing steel tariffs, potentially opening gateways for Cleveland-Cliffs to capitalize on a more liberated steel market. Such policy maneuvers could reshape trade dynamics, potentially bringing fresh revenue streams.

A green light from these discussions could align with strategic corporate measures to adjust operational bandwidth. While these talks are in their initial phases, any developments could act as a catalyst for recalibrating Cleveland-Cliffs’ trade operations. Industry insiders understand that smooth sailing in such dialogues often holds the key to recessionary guards.

Conclusion: Where Does Cleveland-Cliffs Stand?

So, the big question remains: Is Cleveland-Cliffs a buy or bust? For the risk-taker, Cleveland-Cliffs presents an intriguing gamble. If the company’s challenges are resolved and financial performance sees a tilt in the positive direction, returns could be rewarding.

Nonetheless, accusations of fraud, ongoing litigation, and a troubled balance sheet signal caution. Approaching Cleveland-Cliffs with a touch of skepticism, traders must weigh their appetite for risk and potential gain. As millionaire penny stock trader and teacher Tim Sykes says, “The goal is not to win every trade but to protect your capital and keep moving forward.” Whatever their choice may be, this tangled tale revolving around Cleveland-Cliffs certainly casts plenty of shadows and sparks curiosity.

For now, Cleveland-Cliffs Inc. is indeed a perplexing beast, demanding both bold decisions and a scrutinous gaze. With a smattering of patience and maybe a dose of luck, the answers may soon emerge.

This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.

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The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”