Materials| Industrials |Commodities

Rahul Jain

Thematic (Sector/Industry)

<ul>
<li>The U.S. has doubled tariffs on imported steel and aluminum to 50%, citing national security and domestic industry protection.</li>
<li>The move is expected to raise domestic prices, reduce imports, and increase costs for metal-intensive industries.</li>
<li>Winners include U.S.-based producers like Nucor, United States Steel, Cleveland Cliffs and Century Aluminum; losers are foreign exporters like Aloca, RioTinto, Nippon Steel, Ford, GM etc.</li>
</ul>


The U.S. has doubled tariffs on imported steel and aluminum to 50%, citing national security and domestic industry protection.
The move is expected to raise domestic prices, reduce imports, and increase costs for metal-intensive industries.
Winners include U.S.-based producers like Nucor, United States Steel, Cleveland Cliffs and Century Aluminum; losers are foreign exporters like Aloca, RioTinto, Nippon Steel, Ford, GM etc.


Tariff Surge 2025: Winners, Losers, and the Real Impact on U.S. Steel and Aluminium

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.

Equity Bottom-Up

<ul><li>Cleveland-Cliffs Inc in their Q1 2024 Earnings has placed particular emphasize on their tactic of share buybacks as an essential capital allocation method.</li><li>During this time period, the firm was able to procure over 30 million of its own shares, utilizing approximately $608 million from a previous $1 billion share buyback program announced in 2022.</li><li>Over the past few years, the company's diluted share count has been lowered by over 100 million shares, reflecting a significant 17% reduction and pointing to an average purchase price of $18.79 per share, a price point considerably lower than the current trading price.</li></ul>

Cleveland-Cliffs Inc in their Q1 2024 Earnings has placed particular emphasize on their tactic of share buybacks as an essential capital allocation method.During this time period, the firm was able to procure over 30 million of its own shares, utilizing approximately $608 million from a previous $1 billion share buyback program announced in 2022.Over the past few years, the company's diluted share count has been lowered by over 100 million shares, reflecting a significant 17% reduction and pointing to an average purchase price of $18.79 per share, a price point considerably lower than the current trading price.

Cleveland-Cliffs Inc.: Focus On Decarbonization

<ul><li>Cleveland-Cliffs Inc.</li><li>recently conducted an earnings conference call to report their 2023 full year and fourth quarter financial results alongside their M&A strategy and capital allocation priorities going forward.</li><li>The company's comments were predictive and constituted forward-looking statements that may be subject to certain risks and uncertainties.</li></ul>

Cleveland-Cliffs Inc.recently conducted an earnings conference call to report their 2023 full year and fourth quarter financial results alongside their M&A strategy and capital allocation priorities going forward.The company's comments were predictive and constituted forward-looking statements that may be subject to certain risks and uncertainties.

Cleveland-Cliffs Inc: What Is The Big Impact Of M&A Activity On Its Future?  - Major Drivers

<ul><li>Cleveland-Cliffs Inc. managed to exceed analyst expectations in terms of revenue as well as earnings.</li><li>Despite the challenges posed by the UAW strike impacting three automotive sector clients, aggregate shipments to all automotive clients collectively surpassed Q2 levels, reaching 4.1 million net tons.</li><li>Noteworthy cost reduction performance was achieved during Q3, improving by $31 per net ton quarter-over-quarter, with expectations of a further $15 reduction per net ton in the fourth quarter.</li></ul>

Cleveland-Cliffs Inc. managed to exceed analyst expectations in terms of revenue as well as earnings.Despite the challenges posed by the UAW strike impacting three automotive sector clients, aggregate shipments to all automotive clients collectively surpassed Q2 levels, reaching 4.1 million net tons.Noteworthy cost reduction performance was achieved during Q3, improving by $31 per net ton quarter-over-quarter, with expectations of a further $15 reduction per net ton in the fourth quarter.

Cleveland-Cliffs Inc: Conquering Automotive Sector Challenges & Other Major Drivers

European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nippon-steel-corporation" target="_blank" data-smartkarma-citation="entities:961:1" rel="noopener">Nippon Steel Corporation (5401 JP)</a> and <a href="https://www.smartkarma.com/entities/united-states-steel-corp" target="_blank" data-smartkarma-citation="entities:202:1" rel="noopener">United States Steel (X US)</a> have agreed an all-cash $55.00/share offer, 142% premium to where X traded before Cliff's approach, a very generous 7x EV/24e EBITDA.</li>
<li>A determined buyer seeks market share in the lucrative US market, with no meaningful synergies expected and willingness to keep all US Steel jobs and (greener) growth projects.</li>
<li>Although unions and some lawmakers are voicing concerns, CFIUS shouldn't pose a big hurdle. <strong>Spread</strong> is 12.04%/17.93% (gross/annualised, assuming late settlement by end of Q3 2024). <strong>Long.</strong>
</li>
</ul>



Nippon Steel Corporation (5401 JP) and United States Steel (X US) have agreed an all-cash $55.00/share offer, 142% premium to where X traded before Cliff's approach, a very generous 7x EV/24e EBITDA.
A determined buyer seeks market share in the lucrative US market, with no meaningful synergies expected and willingness to keep all US Steel jobs and (greener) growth projects.
Although unions and some lawmakers are voicing concerns, CFIUS shouldn't pose a big hurdle. Spread is 12.04%/17.93% (gross/annualised, assuming late settlement by end of Q3 2024). Long.



Nippon Steel/United States Steel Corp: Knock-Out Offer

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)

Tariff Surge 2025: Winners, Losers, and the Real Impact on U.S. Steel and Aluminium

The U.S. Midwest aluminum premium spiked by 54% on Monday and 164% YTD to $0.58/lb on June 2, driven by new tariffs and typical early-month...

Rahul Jain

Cleveland-Cliffs Inc.: Focus On Decarbonization

Cleveland-Cliffs Inc in their Q1 2024 Earnings has placed particular emphasize on their tactic of share buybacks as an essential capital...

Baptista Research

Cleveland-Cliffs Inc: What Is The Big Impact Of M&A Activity On Its Future? - Major Drivers

Cleveland-Cliffs Inc. recently conducted an earnings conference call to report their 2023 full year and fourth quarter financial results alongside...

Baptista Research

Cleveland-Cliffs Inc: Conquering Automotive Sector Challenges & Other Major Drivers

Cleveland-Cliffs Inc. managed to exceed analyst expectations in terms of revenue as well as earnings. Despite the challenges posed by the UAW...

Baptista Research

Nippon Steel/United States Steel Corp: Knock-Out Offer

This is a very appealing special situation: a motivated buyer, with its cards on the table, financing set aside, support from target and...

Jesus Rodriguez Aguilar

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