Shares of Cleveland-Cliffs (CLF) - Get Report  were rising nearly 4% Thursday after the company was added to the S&P SmallCap 600, replacing Mercury Systems  (MRCY) - Get Report , which will move to the S&P MidCap 400.

The SmallCap 600 admits equities with market capitalizations between $450 million and $2.1 billion and with an average trading volume of 250,000 shares in each of the six months before the review period for its addition. 

Cleveland-Cliffs has a market cap of nearly $1.9 billion. The stock has declined nearly 9% year to date. 

Earlier this week, B. Riley affirmed a buy rating on company but cut analysts their price target to $13 a share from $16.

The new price target represented 80% upside from the stock's Monday closing price of $7.22.

The firm is bearish on an "evolving" macro environment and price environment after Platts reported a 35% decline in Atlantic pellet premiums to $40/dmt.

The new price point hurts the company's sales margins by $10/lt annually, according to B. Riley estimates.

Atlantic pellet prices could stay at these levels for the next several quarters, analyst Lucas Pipes wrote.

Nonetheless, Pipes said he sees Cleveland-Cliffs as an attractive stock with "substantial upside."

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