- The main reason behind the Underperform rating, says analyst Curt Woodworth, is a bearish view of iron ore from his bank's commodity strategists (they're seeing $45 per ton next year, and $40 in 2018).
- The positive catalysts for Cliffs (CLF -0.1%) are in the rear-view mirror, he says, after the big improvement in unit costs, the contract renewal with Mittal, and successful efforts to repair the balance sheet.
- Valuing Cliffs on a sum-of-the-parts basis given the low mine life remaining at APIO, Woodworth comes up fair value of $2 per share (vs. current $5.59).