Cliffs Natural Resources Inc

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CLF : NYSE : Basic Materials
$8.06 -0.03 | -0.37%
Today's Range: 7.77 - 8.13
Avg. Daily Volume: 12,968,900
07/29/16 - 12:03 PM ET

Financial Analysis


CLIFFS NATURAL RESOURCES INC's gross profit margin for the first quarter of its fiscal year 2016 has decreased when compared to the same period a year ago. Even though sales decreased, the net income has increased. CLIFFS NATURAL RESOURCES INC has weak liquidity. Currently, the Quick Ratio is 0.58 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has increased by 6.82% 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 Q1 FY16 Q1 FY15
Net Sales ($mil)305.5448.4
EBITDA ($mil)37.983.9
EBIT ($mil)2.754.1
Net Income ($mil)108.0-759.8


Balance Sheet Q1 FY16 Q1 FY15
Cash & Equiv. ($mil)59.9355.7
Total Assets ($mil)1886.32702.6
Total Debt ($mil)2589.82972.1
Equity ($mil)-1859.4-1995.7


Profitability Q1 FY16 Q1 FY15
Gross Profit Margin21.6425.2
EBITDA Margin12.418.71
Operating Margin0.8812.07
Sales Turnover0.991.19
Return on Assets6.28-292.81
Return on Equity0.00.0
Debt Q1 FY16 Q1 FY15
Current Ratio1.81.8
Debt/Capital3.553.04
Interest Expense56.842.9
Interest Coverage0.051.26


Share Data Q1 FY16 Q1 FY15
Shares outstanding (mil)181.91153.28
Div / share0.00.0
EPS0.610.97
Book value / share-10.22-13.02
Institutional Own % n/a n/a
Avg Daily Volume1.3393385E76630302.0

Valuation


SELL. The current P/E ratio indicates a significant discount compared to an average of 165.02 for the Metals & Mining industry and a value on par with the S&P 500 average of 25.05. 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 25.29 Peers 165.02   CLF 6.81 Peers 12.79

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 64.36 Peers 44.32   CLF NM Peers 2.15

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.

 

Neutral. 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's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CLF NM Peers 1.91   CLF -88.43 Peers -163.28

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 0.69 Peers 3.52   CLF -41.62 Peers -15.18

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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