Financial Survey: Cliffs Natural Resources (NYSE:CLF) versus Its Peers

Cliffs Natural Resources (NYSE: CLF) is one of 28 public companies in the “Steel” industry, but how does it weigh in compared to its peers? We will compare Cliffs Natural Resources to related businesses based on the strength of its institutional ownership, earnings, profitability, dividends, risk, valuation and analyst recommendations.

Analyst Recommendations

This is a summary of recent ratings for Cliffs Natural Resources and its peers, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Cliffs Natural Resources 2 4 2 0 2.00
Cliffs Natural Resources Competitors 290 846 963 29 2.34

Cliffs Natural Resources currently has a consensus target price of $8.40, indicating a potential upside of 33.12%. As a group, “Steel” companies have a potential upside of 4.99%. Given Cliffs Natural Resources’ higher probable upside, equities analysts clearly believe Cliffs Natural Resources is more favorable than its peers.

Earnings and Valuation

This table compares Cliffs Natural Resources and its peers gross revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Cliffs Natural Resources $2.34 billion $480.50 million 12.13
Cliffs Natural Resources Competitors $7.78 billion $1.01 billion 40.13

Cliffs Natural Resources’ peers have higher revenue and earnings than Cliffs Natural Resources. Cliffs Natural Resources is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares Cliffs Natural Resources and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Cliffs Natural Resources 5.48% -29.06% 13.16%
Cliffs Natural Resources Competitors -986.44% 2.95% 2.50%

Volatility and Risk

Cliffs Natural Resources has a beta of 1.65, meaning that its share price is 65% more volatile than the S&P 500. Comparatively, Cliffs Natural Resources’ peers have a beta of 1.37, meaning that their average share price is 37% more volatile than the S&P 500.

Insider and Institutional Ownership

58.3% of Cliffs Natural Resources shares are held by institutional investors. Comparatively, 52.1% of shares of all “Steel” companies are held by institutional investors. 0.5% of Cliffs Natural Resources shares are held by company insiders. Comparatively, 12.1% of shares of all “Steel” companies are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Summary

Cliffs Natural Resources peers beat Cliffs Natural Resources on 8 of the 13 factors compared.

About Cliffs Natural Resources

Cleveland-Cliffs Inc, formerly Cliffs Natural Resources Inc., is a mining and natural resources company. The Company is a supplier of iron ore pellets to the North American steel industry from its mines and pellet plants located in Michigan and Minnesota. The Company’s segments include U.S. Iron Ore and Asia Pacific Iron Ore. The Company is a producer of iron ore pellets, primarily selling production from U.S. Iron Ore to integrated steel companies in the United States, Canada and Mexico. Its Asia Pacific Iron Ore operations are located in Western Australia and consist of its Koolyanobbing operation. The Koolyanobbing operations serve the Asian iron ore markets with direct-shipped fines and lump ore. In addition, the Company operates an iron ore mining complex in Western Australia. In the United States, the Company owned four operational iron ore mines and one indefinitely idled mine.

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