Why Has Cleveland-Cliffs (CLF) Dropped 22.3% Following Its Most Recent Earnings Announcement?

Cleveland-Cliffs Stock Performance Since Last Earnings

Roughly a month has passed since Cleveland-Cliffs (CLF) released its most recent earnings report. During this period, the company's share price has dropped by about 22.3%, falling behind the broader S&P 500 index.

What’s Next for Cleveland-Cliffs?

With this decline, investors are left to wonder whether the downward momentum will persist until the next earnings announcement, or if a turnaround is on the horizon. To better understand the current situation, let's review the highlights from the latest earnings report and see how market participants have responded.

Fourth Quarter Results: Earnings and Revenue Overview

For the fourth quarter of 2025, Cleveland-Cliffs reported an adjusted loss of $0.43 per share. This result was better than the anticipated loss of $0.62 per share, and also an improvement over the $0.68 per share loss reported in the same quarter last year.

Total revenue for the quarter was $4.313 billion, which was nearly unchanged from the previous year. However, this figure came in below analysts’ expectations of $4.62 billion.

Operational Performance

Steelmaking revenue for the quarter totaled approximately $4.15 billion, representing a slight year-over-year decrease of 0.3%.

• The average net selling price per ton of steel was $993, up about 2% from the previous year, though this was slightly below the consensus estimate of $1,004.
• External steel product sales reached around 3.77 million net tons, a decrease of 1.5% year over year and below the expected 4.01 million net tons.

Financial Health

At the end of the fourth quarter, Cleveland-Cliffs held $57 million in cash and cash equivalents, marking a 14% decline from the prior quarter. Long-term debt was reduced by 10% sequentially, standing at $7.253 billion. As of December 31, 2025, the company’s total liquidity was $3.3 billion.

Guidance for 2026

Looking ahead to the full year 2026, Cleveland-Cliffs provided the following outlook:

• Capital expenditures are projected to be around $700 million.
• Selling, general, and administrative expenses are expected to total about $575 million.
• The company aims to lower steel unit costs by approximately $10 per net ton compared to 2025.
• Depreciation, depletion, and amortization expenses are estimated at $1.1 billion.
• Payments and contributions for pension and other post-employment benefits are anticipated to be roughly $125 million.

Recent Changes in Analyst Estimates

Over the past month, analyst estimates for Cleveland-Cliffs have been revised downward. The consensus estimate has shifted by -131.11% as a result of these adjustments.

VGM Score Breakdown

Currently, Cleveland-Cliffs holds a Growth Score of C and a Momentum Score of C. However, its Value Score is rated F, placing it among the lowest 20% for this investment style. The overall VGM Score for the stock is F, which is particularly relevant for investors who do not focus on a single strategy.

Future Prospects

Given the broad downward trend in analyst estimates, Cleveland-Cliffs has received a Zacks Rank #4 (Sell). Based on these factors, the stock is expected to underperform in the coming months.

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