Smartkarma AI Primers, Smartkarma

αSK Primers

Smartkarma AI Primers

Smartkarma

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Equity Bottom-Up

<ul>
 <li>
Transformed Business Model: Cleveland-Cliffs has evolved from a pure-play iron ore miner into the largest flat-rolled steel producer in North America through the major acquisitions of AK Steel and ArcelorMittal USA in 2020.</li>
 <li>
Vertically Integrated Operations: The company's key competitive advantage is its vertical integration, controlling the entire production process from its own iron ore mines to finished steel products, which provides greater cost control and supply chain security.</li>
 <li>
Challenging Financials but Improving Outlook: After two years of significant net losses, the company has returned to positive free cash flow and is guiding for stronger shipments and improved pricing, supported by a strong order book and the benefits of trade protections.</li>
</ul>This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.


  
Transformed Business Model: Cleveland-Cliffs has evolved from a pure-play iron ore miner into the largest flat-rolled steel producer in North America through the major acquisitions of AK Steel and ArcelorMittal USA in 2020.
  
Vertically Integrated Operations: The company's key competitive advantage is its vertical integration, controlling the entire production process from its own iron ore mines to finished steel products, which provides greater cost control and supply chain security.
  
Challenging Financials but Improving Outlook: After two years of significant net losses, the company has returned to positive free cash flow and is guiding for stronger shipments and improved pricing, supported by a strong order book and the benefits of trade protections.
This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

Primer: Cleveland-Cliffs Inc  (CLF US) - Jul 2026

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>Cleveland-Cliffs reported a second quarter 2026 adjusted EBITDA of $286 million, marking its strongest quarter in two years, alongside a return to positive free cash flow after two years of negative results.</li><li>Despite a sequential decline in shipments largely due to maintenance outages and contract timing, the company expects shipments to surpass 4.3 million tons in the third quarter, supported by a strong order book and extended backlogs.</li><li>Pricing improvements contributed significantly to the quarter’s results, with average selling prices increasing by $76 per ton, driven by favorable hot-rolled coil (HRC) and cold-rolled coil price trajectories.</li></ul>

Cleveland-Cliffs reported a second quarter 2026 adjusted EBITDA of $286 million, marking its strongest quarter in two years, alongside a return to positive free cash flow after two years of negative results.Despite a sequential decline in shipments largely due to maintenance outages and contract timing, the company expects shipments to surpass 4.3 million tons in the third quarter, supported by a strong order book and extended backlogs.Pricing improvements contributed significantly to the quarter’s results, with average selling prices increasing by $76 per ton, driven by favorable hot-rolled coil (HRC) and cold-rolled coil price trajectories.

Cleveland-Cliffs Targets 4.3 Million Tons: Can Volume And Pricing Align?

Equity, Bottom-up Analyst, Investics Research

Sameer Taneja

Equity, Bottom-up Analyst

Investics Research

It is important to note that the information provided by Investics Research is based on publicly available data and own knowledge, which has been gathered and analyzed from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions. All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include but are not limited to, company announcements, exchange filings, presentations, etc. Investics does not guarantee the accuracy and completeness of the forecasts, estimates, and/or other information.

Equity Bottom-up Research

<ul>
<li>Following our initiation on <a href="https://www.smartkarma.com/entities/mount-gibson-iron-ltd" target="_blank" data-smartkarma-citation="entities:19043:1" rel="noopener">Mount Gibson Iron (MGX AU)</a> and <a href="https://www.smartkarma.com/entities/kumba-iron-ore-ltd" target="_blank" data-smartkarma-citation="entities:25094:1" rel="noopener">Kumba Iron Ore (KIO SJ)</a>, recently we initiate coverage on <a href="https://www.smartkarma.com/entities/champion-iron-ltd" target="_blank" data-smartkarma-citation="entities:19734:1" rel="noopener">Champion Iron (CIA AU)</a>, a pure play with Canadian assets.</li>
<li>Although it is more richly priced than the other two names, it offers a 50% volume expansion opportunity in FY25/26, subject to financing availability. </li>
<li>Trading at 8.6x FY25 (March-end) PE, 4.6x EV-EBITDA, and a 6% dividend yield (subject to capex), this is not our favorite name at the current price due to production uncertainty. </li>
</ul>


Following our initiation on Mount Gibson Iron (MGX AU) and Kumba Iron Ore (KIO SJ), recently we initiate coverage on Champion Iron (CIA AU), a pure play with Canadian assets.
Although it is more richly priced than the other two names, it offers a 50% volume expansion opportunity in FY25/26, subject to financing availability. 
Trading at 8.6x FY25 (March-end) PE, 4.6x EV-EBITDA, and a 6% dividend yield (subject to capex), this is not our favorite name at the current price due to production uncertainty. 


Champion Iron (CIA CN): Another Expansion Iron Ore Pure Play on High-Grade Ore

<ul>
<li>Investics Research will initiate coverage of the materials sector in April 2024, starting with iron ore and then gold, coal, and steel in subsequent months (in that order).</li>
<li>The areas of coverage on asset classes will encompass the underlying commodity and the associated equities. </li>
<li>Areas of differentiation would include in-depth coverage of all equities (small/mid and large cap) and actionable tactical ideas on the commodity.</li>
</ul>


Investics Research will initiate coverage of the materials sector in April 2024, starting with iron ore and then gold, coal, and steel in subsequent months (in that order).
The areas of coverage on asset classes will encompass the underlying commodity and the associated equities. 
Areas of differentiation would include in-depth coverage of all equities (small/mid and large cap) and actionable tactical ideas on the commodity.


Introduction: Initiation of Coverage in the Materials Sector

<ul><li>Cleveland-Cliffs entered 2026 framing its recent performance as the result of a difficult but transitional period rather than a reflection of deteriorating structural competitiveness.</li><li>The discussion highlighted that 2025 results were pressured by elevated steel imports, weak domestic vehicle production, unfavorable dynamics in the Canadian steel market, and the final year of an onerous slab supply arrangement.</li><li>These factors weighed on shipments, pricing, and asset utilization, but management argued that several of them have either been removed or are beginning to improve.</li></ul>

Cleveland-Cliffs entered 2026 framing its recent performance as the result of a difficult but transitional period rather than a reflection of deteriorating structural competitiveness.The discussion highlighted that 2025 results were pressured by elevated steel imports, weak domestic vehicle production, unfavorable dynamics in the Canadian steel market, and the final year of an onerous slab supply arrangement.These factors weighed on shipments, pricing, and asset utilization, but management argued that several of them have either been removed or are beginning to improve.

Cleveland-Cliffs: Pricing Power, Auto Demand & Cost Discipline—Three Forces Driving the Next Phase!

United States

Cleveland-Cliffs Inc. is an American iron ore mining company. The Company supplies iron ore pellets, lumps and fines to blast furnaces in the global steel industry. Cliffs is in the process of expanding its customer base to Electric Arc Furnaces.

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Cleveland-Cliffs Inc (CLF US)

Primer: Cleveland-Cliffs Inc (CLF US) - Jul 2026

Transformed Business Model: Cleveland-Cliffs has evolved from a pure-play iron ore miner into the largest flat-rolled steel producer in North...

αSK Primers

Cleveland-Cliffs Targets 4.3 Million Tons: Can Volume And Pricing Align?

Cleveland-Cliffs reported a second quarter 2026 adjusted EBITDA of $286 million, marking its strongest quarter in two years, alongside a return to...

Baptista Research

Champion Iron (CIA CN): Another Expansion Iron Ore Pure Play on High-Grade Ore

We further expand our coverage in iron ore names by initiating on Champion Iron (CIA AU). With exposure to high-grade Fe ore at 65%, this could be...

Sameer Taneja

Introduction: Initiation of Coverage in the Materials Sector

We provide readers with an introduction to our initiation on commodities. We also provide a rationale as to how our coverage will be comprehensive...

Sameer Taneja

Cleveland-Cliffs: Pricing Power, Auto Demand & Cost Discipline—Three Forces Driving the Next Phase!

Cleveland-Cliffs entered 2026 framing its recent performance as the result of a difficult but transitional period rather than a reflection of...

Baptista Research

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