Cleveland-Cliffs (CLF) Declares Share Repurchase Worth $200M
Zacks Investment Research | Nov 27, 2018 06:00AM ET
Cleveland-Cliffs Inc.’s (NYSE:CLF) board has authorized the buyback of its outstanding common shares. The authorization is active until Dec 31, 2019.
Per the share repurchase program, Cleveland-Cliffs will have considerable flexibility to repurchase shares worth up to a maximum of $200 million. The company can buy the shares through acquisitions in the open market or privately-negotiated transactions, which also include accelerated share repurchases.
The company stated that it is not obligated to make any purchases. Moreover, the program may be discontinued or suspended at any time. According to Cleveland-Cliffs, the disconnect between the current volatility in the capital markets and its strong profitability have provided opportunity for a highly accretive use of capital through repurchase of its common shares.
Shares of Cleveland-Cliffs have rallied 31% in the past year, against the industry ’s 5.7% decline.
Cleveland-Cliffs’ profits (attributable to shareholders) climbed to $437.8 million or $1.41 per share in third-quarter 2018 from $53.4 million or 18 cents in the prior-year quarter. Revenues also went up roughly 24% year over year to $741.8 million.
Last month, Cleveland-Cliffs stated that it expects to realize U.S. Iron Ore revenue rates in the range of $105-$110 per long ton, assuming that steel prices, pellet premiums and iron ore prices will average for the rest of 2018 their respective year-to-date averages.
For 2018, the company has maintained the sales and production volume expectations for U.S. Iron Ore at 21 million long tons and 20 million long tons, respectively. Cash cost of goods sold and operating expenses expectations are unchanged at $58-$63 per long ton.
Zacks Rank & Other Stocks to Consider
Cleveland-Cliffs currently carries a Zacks Rank #2 (Buy).
A few other top-ranked stocks in the basic materials space include CF Industries Holdings, Inc. (NYSE:CF) , Methanex Corp. (NASDAQ:MEOH) and The Mosaic Company (NYSE:MOS) , each sporting a Zacks Rank #1 (Strong Buy). You can see Original post
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