June was a banner month for American steel producer Cleveland-Cliffs (CLF 7.88%). It received much investor attention after President Trump signed an executive order doubling tariffs on steel coming into this country, a move that will directly and clearly benefit Cleveland-Cliffs if it holds. Over the month, investors clearly bet it would, and traded the company's stock more than 30% higher. Steeling for a fightTrump's latest steel tariff was actually imposed weeks before the so-called "Liberation Day," whe ...

Core Viewpoint - Bank of America Securities analyst Rafe Jadrosich upgraded Whirlpool Corporation from Underperform to Neutral, raising the price forecast from $68 to $94 due to improved North American margin prospects and tariff-related benefits [1]. Group 1: Financial Estimates - The analyst increased 2025 earnings estimates to $8.56 from $8.35 and 2026 EPS estimates to $10.33 from $9.39, benefiting from new appliance-related steel tariffs [1]. - Fiscal year 2027 earnings per share were raised to $10.73 from $9.96 [6]. Group 2: Tariff Impact - Whirlpool is well positioned to benefit from new Section 232 tariffs, which will impose a 50% duty on the steel content of imported home appliances starting June 23, as 80% of its U.S. sales are domestically produced and 96% of its steel is U.S.-sourced [3]. - Competitors relying on imports for over half of their U.S. sales, particularly from China and Korea, will face increased costs, reducing their previous cost advantage [4]. Group 3: Competitive Advantage - The tariffs could force competitors to raise wholesale appliance prices by 3–5%, or approximately $15–$20 per unit, potentially giving Whirlpool a competitive edge [5]. - A price increase of $15–$20 on half of Whirlpool's North America volume could boost EBIT margins by 150–200 basis points and raise profits by 20–30% [5]. - With appliance manufacturing being a low-margin business, rivals are expected to pass on costs, allowing Whirlpool to gain market share or expand margins [6].

Steel tariffs gaveth, and now steel tariffs taketh away... from Cleveland-Cliffs' stock price.Cleveland-Cliffs (CLF -8.29%) stock fell 8.5% through 2:10 p.m. ET Tuesday after Reuters reported on new trade negotiations between the U.S. and Mexico that could significantly roll back 50% tariffs on steel imports -- which had themselves been announced only last week. 50% -- up to a pointThe negotiations would not affect all steel imports -- only those from Mexico, and only to an extent. While details haven't ye ...

Shares of Cleveland-Cliffs (CLF 5.07%) are moving higher this week, up 28.8% from last Friday's close as of 2:00 p.m. ET. The gain comes as the S&P 500 rose 1.5% and the Nasdaq-100 increased 2.1%. The American steelmaker will benefit from President Donald Trump's new steel tariffs that went into effect earlier this week.Foreign steel gets an additional levyLast week, the Trump administration announced it would raise the already levied 25% tariffs on foreign steel to 50%. On Tuesday, President Trump official ...

Core Viewpoint - The U.S. has implemented a 50% tariff on imported steel and aluminum, creating significant opportunities for domestic producers like Cleveland-Cliffs Inc, Nucor Corp, and Steel Dynamics Inc [1][2]. Group 1: Impact of Tariffs on Companies - Cleveland-Cliffs Inc experienced a 25.2% gain in early trading following the tariff announcement, allowing the company to raise prices by $200-300 per ton while remaining competitive [3][4]. - Nucor Corp is expected to boost its EBITDA margins to the 18-20% range over the next 12-18 months due to its low-cost electric arc furnace model and reduced import competition [4]. - Steel Dynamics Inc's diversification into aluminum production is now advantageous, as rising tariffs on both steel and aluminum enhance its pricing power [5]. Group 2: Broader Market Implications - Investors may consider steel-focused ETFs like the VanEck Steel ETF and the SPDR S&P Metals and Mining ETF for diversified exposure to the steel sector [6]. - While current gains are significant, there are concerns about potential policy changes by late 2025 due to structural supply gaps and midterm politics [6].

Financial Data and Key Metrics Changes - In Q1 2025, net sales totaled $280.5 million, a sequential increase of $40 million or 17% [17] - Net income for the quarter was $1.3 million or $0.03 per diluted share, while adjusted net income was $3.2 million or $0.07 per diluted share [18] - Adjusted EBITDA reached $17.7 million, a sequential increase of $9.4 million [18] - Manufacturing costs declined by $12.5 million sequentially due to increased cost absorption and lower maintenance costs [19] Business Line Data and Key Metrics Changes - Overall shipments increased by 17% compared to the previous quarter, driven by higher industrial, automotive, and energy shipments [10] - Shipments to industrial customers rose by 33% sequentially, while energy shipments improved by 24% [11][12] - Automotive shipments increased by 9% sequentially, primarily due to seasonality [13] - Aerospace and defense shipments decreased due to production startup challenges but are expected to recover in the second quarter [14] Market Data and Key Metrics Changes - The order backlog increased approximately 50% from the same period last year, reflecting growing demand for U.S.-produced steel [7] - Lead times for SBQ bars and seamless mechanical tubing products currently extend to ten weeks [11] - The energy market is seeing increased demand as customers shift from imports to domestic sourcing [35] Company Strategy and Development Direction - The company plans to invest approximately $5 million in safety management systems and equipment upgrades in 2025 [8] - Capital allocation strategy prioritizes strategic investments for long-term growth and ongoing share repurchase programs [15] - The company remains focused on executing its business strategy while prioritizing safety and customer service [16] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism despite macroeconomic uncertainties, citing a strong U.S.-based business model [16] - The company anticipates second-quarter adjusted EBITDA to be higher than in the first quarter, with modest increases in shipments expected [26] - Management is confident in meeting the 2025 revenue goal of approximately $30 million from vacuum arc remelt products [15] Other Important Information - The company made $52.6 million in required pension contributions in Q1 2025, with expectations of reduced future contributions [20] - Cash flow for the first quarter was an outflow of $38.9 million, primarily due to pension contributions [21] - The company repurchased 395,000 shares for $5.6 million in Q1 and had $96 million remaining under its share repurchase authorization as of April [25] Q&A Session Summary Question: How much of the volume boost in Q1 2025 is due to pull forward demand related to tariffs? - Management indicated that very little of the shipment increase was due to tariff hedging, as most orders were placed in Q4 2024, and the tariffs did not take effect until April [34] Question: What is the outlook for the energy market and customer demand? - Management expects continued demand growth in the energy sector as customers seek domestic sourcing, despite some inventory overhang from imports [35] Question: Can you provide details on the aerospace and defense customer manufacturing startup challenges? - Management noted that a new facility faced commissioning difficulties but expects to see orders from this facility later in the year as progress is made [41]

Financial Data and Key Metrics Changes - In the first quarter, net sales totaled $280.5 million, a sequential increase of $40 million or 17% [16] - Net income for the first quarter was $1.3 million or $0.03 per diluted share, while adjusted net income was $3.2 million or $0.07 per diluted share [18] - Adjusted EBITDA was $17.7 million, a sequential increase of $9.4 million, driven by higher shipments and lower manufacturing costs [19] Business Line Data and Key Metrics Changes - Overall shipments increased by 17% compared to the previous quarter, with significant increases in industrial (33%) and energy (24%) shipments, while aerospace and defense shipments decreased due to production startup challenges [9][10][12] - Automotive shipments improved by 9% sequentially, primarily driven by seasonality [12] - The order backlog increased approximately 50% from the same period a year ago, reflecting strong demand for U.S. produced steel [6] Market Data and Key Metrics Changes - Shipments to industrial customers increased significantly, driven by distributors replenishing their inventory [10] - Energy shipments improved despite a flat rig count, indicating market share gains in specific product categories [11] - Aerospace and defense shipments are expected to recover in the second quarter as the industry addresses supply chain challenges [13] Company Strategy and Development Direction - The company is focused on capitalizing on the growing demand for domestic steel and has a strong balance sheet to support its strategy [4][6] - Investments in safety management systems and equipment upgrades are planned for 2025, with a budget of approximately $5 million [7] - The capital allocation strategy prioritizes strategic investments for long-term growth and includes an ongoing share repurchase program [14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the trade environment and macroeconomic landscape, emphasizing the company's U.S.-based business model [15] - The company anticipates second quarter adjusted EBITDA to be higher than the first quarter, with expected increases in shipments and operational performance [27][28] - Management remains committed to delivering quality products while driving profitability [29] Other Important Information - The company made $52.6 million in required pension contributions in the first quarter, with expectations of a significant reduction in future contributions [20] - Cash flow for the first quarter was an outflow of $38.9 million, primarily due to pension contributions [21] - The company received $11.9 million in government funding as part of a $99.75 million agreement to support munitions production [23][24] Q&A Session Summary Question: How much of the volume boost in Q1 is due to pull forward demand related to tariffs? - Management indicated that very little of the shipment increase was related to hedging against tariffs, as most orders were placed in Q4, and the tariffs took effect in April [34][35] Question: What is the outlook for the energy market and customer demand? - Management expects continued demand increase in the energy sector as customers seek domestic sourcing, despite some inventory overhang from foreign imports [36][37] Question: Can you provide details on customer manufacturing startup challenges in aerospace and defense? - Management noted that a new facility faced commissioning difficulties but expects progress and increased orders later in the year, along with new inquiries for munitions grades [41][42]

Cleveland-Cliffs (CLF) Q1 2025 Earnings Call May 08, 2025 08:30 AM ET Company Participants Lourenco Goncalves - Chairman, President & CEOCelso Goncalves - EVP and CFOAlbert Realini - Senior Equity Research AssociateBill Peterson - Equity ResearchTimna Tanners - Managing Director - Equity Research Conference Call Participants Nick Giles - Senior Research AnalystLawson Winder - AnalystAlex Hacking - Equity Research Analyst - Metals & MiningCarlos de Alba - Analyst Operator Good morning, ladies and gentlemen. ...

Cleveland-Cliffs (CLF) Q1 2025 Earnings Call May 08, 2025 08:30 AM ET Speaker0 Good morning, ladies and gentlemen. My name is Sherry, and I will be your conference facilitator today. I would like to welcome everybody to Cleveland Cliffs First Quarter twenty twenty five Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. The company reminds you that certain comments made on today's call will in ...