TLDR
- Wells Fargo raised Cleveland-Cliffs to Overweight with a $14 price target, up from $12.
- Shares of CLF advanced roughly 1% to approximately $12.30 during Tuesday’s session.
- Analyst Timna Tanners projects EBITDA for late 2026 and 2027 will surpass current consensus estimates.
- Hot rolled coil prices have surged from around $900 to $1,300 per ton year-to-date.
- Just 25% of analysts covering CLF maintain Buy ratings, significantly below the 55-60% S&P 500 average.
Shares of Cleveland-Cliffs advanced approximately 1% to reach $12.30 during Tuesday trading following a Wells Fargo upgrade. Analyst Timna Tanners elevated her stance to Overweight from Equal Weight while simultaneously raising her price objective to $14 from the previous $12 target.
According to Tanners, the steelmaker’s future earnings have the potential to significantly surpass current Wall Street projections. Her analysis highlights the second half of 2026 and the full 2027 calendar year as key timeframes when this outperformance may materialize.
Current consensus estimates call for approximately $1.3 billion in combined second and third quarter EBITDA for 2026. Looking ahead to 2027, analyst forecasts cluster around $2.3 billion.
As a reference point, Cleveland-Cliffs achieved $5.3 billion in EBITDA during 2021, representing its strongest annual performance to date. During that period, steel prices reached approximately $1,900 per ton.
Steel Prices Are Climbing Again
Benchmark steel valuations began 2026 hovering around $900 per ton. Since then, prices have escalated to roughly $1,300 per ton, expanding the company’s profit potential.
According to Wells Fargo’s research, hot rolled coil lead times have stretched to levels approaching those seen during the pandemic era. Purchasers are experiencing significant challenges securing material within acceptable timeframes.
In Houston, U.S. landed hot rolled coil prices have climbed approximately $235 per ton following the onset of the Iran conflict. By comparison, Southeast Asian prices—frequently referenced as a global benchmark—increased only $35 per ton during the identical period.
Tanners characterized this upgrade as a tactical position rather than a structural long-term investment thesis. Her view suggests the steel pricing cycle is approaching its peak, yet Cleveland-Cliffs has not yet fully captured the financial benefits.
A Rocky Setup Ahead of New Competition
CLF shares touched a low of $11 during the previous week. That represents approximately a 5% decline from levels prior to President Trump’s endorsement of a new steel manufacturing facility in Iowa.
Mesabi Metallics has announced plans for a $15 billion fully integrated steel complex in that state. Upon reaching full operational capacity, the facility is projected to produce eight to nine million tons of finished steel products annually.
That volume represents a substantial portion of the domestic market, which currently manufactures 80 to 90 million tons per year while importing an additional 20 to 25 million tons. Additional supply of this magnitude could either displace foreign imports or pressure existing domestic manufacturers.
The proposed facility remains several years from operational status, however. At present, Cliffs is valued based on near-term EBITDA projections rather than distant competitive threats.
Currently, only 25% of analysts monitoring Cliffs maintain Buy recommendations on the stock. As a comparison point, the average S&P 500 component typically carries Buy ratings from 55-60% of covering analysts.
That metric has been trending upward, however. During the summer months, merely two analysts held Buy ratings on the shares. That figure has now doubled to four.
The consensus price target among analysts stands at approximately $13, representing an increase from roughly $12 one year ago.
Cleveland-Cliffs is scheduled to release quarterly results in 13 days. During its most recent quarter, the company delivered $5.2 billion in revenue, aligning with analyst expectations, while posting a per-share loss of $0.20, marginally wider than the anticipated $0.19 loss.
Wells Fargo additionally noted that cost pressures emerged as the primary concern voiced by management teams during the previous quarter. The firm continues to favor aluminum equities and copper producer Freeport-McMoRan as superior long-term sector investments compared to steel.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
