Cliffs Natural Resources Inc

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CLF : NYSE : Basic Materials
$6.03 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 13,897,400
08/29/16 - 4:00 PM ET

Financial Analysis


CLIFFS NATURAL RESOURCES INC's gross profit margin for the second quarter of its fiscal year 2016 has significantly increased when compared to the same period a year ago. Even though sales increased, the net income has decreased, representing a decrease to the bottom line. CLIFFS NATURAL RESOURCES INC has weak liquidity. Currently, the Quick Ratio is 0.64 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 4.83% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)499.4498.8
EBITDA ($mil)99.154.6
EBIT ($mil)72.224.0
Net Income ($mil)12.860.2


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)108.2276.2
Total Assets ($mil)1851.02609.4
Total Debt ($mil)2574.12972.8
Equity ($mil)-1830.7-1923.8


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin24.3517.1
EBITDA Margin19.8410.94
Operating Margin14.464.81
Sales Turnover1.021.14
Return on Assets3.84-301.38
Return on Equity0.00.0
Debt Q2 FY16 Q2 FY15
Current Ratio2.071.82
Debt/Capital3.462.83
Interest Expense50.763.6
Interest Coverage1.420.38


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)183.87153.41
Div / share0.00.0
EPS0.07-0.28
Book value / share-9.96-12.54
Institutional Own % n/a n/a
Avg Daily Volume1.3873265E71.036709E7

Valuation


HOLD. CLIFFS NATURAL RESOURCES INC's P/E ratio indicates a significant discount compared to an average of 322.99 for the Metals & Mining industry and a significant discount compared to the S&P 500 average of 25.13. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. After reviewing these and other key valuation criteria, CLIFFS NATURAL RESOURCES INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CLF 9.37 Peers 322.99   CLF 3.35 Peers 13.16

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

CLF is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CLF is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CLF 12.97 Peers 36.45   CLF 0.11 Peers 0.82

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

CLF is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CLF trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CLF NM Peers 1.85   CLF -60.38 Peers -152.84

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CLF's P/B is negative making this valuation measure meaningless.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

CLF is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CLF 0.58 Peers 3.56   CLF -36.55 Peers -11.78

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CLF is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

CLF significantly trails its peers on the basis of sales growth

 

 

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