Cliffs Natural Resources
The 10-second takeaway
For the quarter ended June 30 (Q2), Cliffs Natural Resources beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue shrank. Non-GAAP earnings per share contracted significantly. GAAP earnings per share shrank significantly.
Margins dropped across the board.
Cliffs Natural Resources logged revenue of $1.49 billion. The 13 analysts polled by S&P Capital IQ anticipated sales of $1.42 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.13. The 18 earnings estimates compiled by S&P Capital IQ anticipated $0.58 per share. Non-GAAP EPS of $1.13 for Q2 were 38% lower than the prior-year quarter's $1.81 per share. (The prior-year quarter included $0.06 per share in earnings from discontinued operations.) GAAP EPS of $0.82 for Q2 were 55% lower than the prior-year quarter's $1.81 per share. (The prior-year quarter included $0.06 per share in earnings from discontinued operations.)
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 18.0%, much worse than the prior-year quarter. Operating margin was 17.6%, 580 basis points worse than the prior-year quarter. Net margin was 9.8%, 710 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.44 billion. On the bottom line, the average EPS estimate is $0.42.
Next year's average estimate for revenue is $5.45 billion. The average EPS estimate is $2.25.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,605 members out of 1,674 rating the stock outperform, and 69 members rating it underperform. Among 297 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 283 give Cliffs Natural Resources a green thumbs-up, and 14 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Cliffs Natural Resources is hold, with an average price target of $21.88.
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