Why Has Cleveland-Cliffs Stock Surged 50%?

Core Insights - Cleveland-Cliffs Inc (CLF) has seen a stock increase of 57% over the past month, outperforming the S&P 500 Index, which rose by 4% [2] - The company reported an adjusted earnings loss of –$0.50 per share in Q2 2025, better than the expected –$0.71, with record steel shipments of 4.3 million net tons [3] - The recent increase in U.S. steel tariffs to 50% has positively impacted investor sentiment, as CLF is expected to benefit from stronger domestic pricing [3] Stock Performance - CLF's stock fell over 54% from July 2024 to May 2025 due to declining steel demand, weak pricing, increasing losses, and rising debt [4] - The stock has begun to recover following this decline, indicating a potential turnaround [4] Financial Metrics - The price-to-sales (PS) multiple for Cleveland-Cliffs has decreased from 1.0x in 2020 to 0.2x in 2024, suggesting potential for upward movement compared to historical levels [5] - In Q2, CLF generated revenues of $4.9 billion and returned to a positive adjusted EBITDA of $97 million, a $271 million increase from Q1 [6] - The company achieved a $15 per ton reduction in steel unit costs quarter over quarter and ended the quarter with $2.7 billion in liquidity [6] Future Outlook - CLF has reaffirmed a target of $50 per ton for cost reductions in 2025, indicating ongoing improvements in operational efficiency [6]