Cleveland-Cliffs Inc. (CLF): A Bull Case Theory

We came crossed a bullish thesis on Cleveland-Cliffs Inc.  on r/wallstreetbets by politicalinvestor. In this article, we volition summarize the bulls’ thesis connected CLF. Cleveland-Cliffs Inc.'s stock was trading astatine $13.36 arsenic of January 13th. CLF’s trailing and guardant P/E were 133.67 and 62.89 respectively according to Yahoo Finance.

Cleveland-Cliffs stands retired arsenic 1 of the precise fewer alloy companies that person not already delivered multi 100 percent returns implicit the past 5 years, creating an asymmetric setup arsenic some company-specific and macro tailwinds statesman to align.

After years of alternating bullish and bearish conditions, the institution appears to beryllium entering a decisive signifier driven by structural changes alternatively than cyclical noise. A imaginable strategical concern from POSCO, estimated astatine a 10 to 20 % stake, could materially fortify the equilibrium expanse portion validating Cliffs’ vertically integrated U.S. alloy model.

Management has already taken meaningful enactment by idling oregon permanently closing astatine slightest six debased borderline facilities, with further rationalization likely, which should assistance consolidated margins and trim currency burn. Beyond steel, the company’s robust ore mining footprint presents a imaginable agelong word accidental successful uncommon world extraction, an underappreciated plus that could go strategically important arsenic the U.S. seeks to trim reliance connected overseas proviso chains.

Tariffs proceed to supply a nonstop boost to home pricing power, portion a shifting complaint situation adds different lever. With Chair Powell expected to exit successful 2026, further complaint cuts could importantly easiness Cliffs’ indebtedness burden, particularly erstwhile combined with proceeds from imaginable extracurricular investments. On the request side, involvement escaped oregon subsidized car financing would enactment conveyance accumulation and alloy strength astatine a clip erstwhile Cliffs is focused connected higher worth extremity markets.

Options enactment aft May allows for different net and filing rhythm to corroborate improving fundamentals. Even nether pessimistic assumptions, upside toward $20 appears reasonable, portion a favorable macro and execution script supports a determination supra $30. History suggests that a pro manufacturing argumentation backdrop could further amplify these gains.

Previously we covered a bullish thesis connected Steel Dynamics, Inc. by Gregg Jahnke successful February 2025, which highlighted operational efficiency, equilibrium expanse strength, and agelong word worth creation. The company’s banal terms has appreciated by astir by 27.82% since our coverage. This is due to the fact that the thesis played retired amid tariff dynamics and disciplined execution. Politicalinvestor shares a akin thesis connected Cleveland-Cliffs Inc. but emphasizes equilibrium expanse repair, macro tailwinds, and asymmetric upside.