Earnings Preview: Cleveland-Cliffs (CLF) Q2 Earnings Expected to Decline

Core Viewpoint - Cleveland-Cliffs (CLF) is expected to report a year-over-year decline in earnings due to lower revenues, with a consensus outlook indicating a break-even quarterly earnings per share (EPS) and revenues of $5.24 billion, down 12.5% from the previous year [1][2]. Group 1: Earnings Expectations - The consensus EPS estimate has been revised down by 65.96% over the last 30 days, reflecting a bearish sentiment among analysts regarding the company's earnings prospects [2]. - The Most Accurate Estimate for Cleveland-Cliffs is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -200%, indicating a negative outlook for the upcoming earnings report [5][6]. Group 2: Historical Performance - In the last reported quarter, Cleveland-Cliffs was expected to post earnings of$ 0.19 per share but delivered $0.18, resulting in a surprise of -5.26% [7]. - Over the past four quarters, the company has beaten consensus EPS estimates two times, suggesting some volatility in its earnings performance [7]. Group 3: Predictive Indicators - A positive Earnings ESP is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3; however, Cleveland-Cliffs currently holds a Zacks Rank of 4, making it difficult to predict an earnings beat [4][6]. - The predictive power of Earnings ESP is significant primarily for positive readings, and a negative Earnings ESP does not necessarily indicate an earnings miss [4]. Group 4: Market Reaction - The stock price may react positively if the actual results exceed expectations, while a miss could lead to a decline in stock value [1]. - Other factors beyond earnings results may also influence stock movement, indicating that an earnings beat alone may not guarantee a positive market reaction [8].