Why Investors Were Fired up About Cleveland-Cliffs Stock Today

Core Viewpoint - Market players are showing strong confidence in Cleveland-Cliffs, leading to a significant upsizing of a planned debt issue, which positively impacted the company's stock price, rising by 9% compared to the S&P 500's 0.6% increase [1]. Debt Issuance - Cleveland-Cliffs announced a new issue of senior unsecured guaranteed notes, initially set at $200 million, maturing in 2034, with an interest rate of just under 7.63% [3][4]. - The company later increased the total principal amount to $275 million, with an issuance price of approximately 102.8% of the principal, resulting in an implied yield of slightly below 7% for investors [4]. Financial Context - The steel industry typically requires substantial debt financing due to the high costs associated with owning and operating steel production facilities. Cleveland-Cliffs' long-term debt has exceeded $7.7 billion, largely due to its acquisition of Stelco in 2024 [5][6]. - The new debt issuance, while relatively small compared to total debt, indicates investor confidence in Cleveland-Cliffs' ability to meet its financial obligations [6].