NEW YORK (TheStreet) -- Cliffs Natural Resources (CLF) was falling 3.7% to $13.85 Thursday after Deutsche Bank lowered its iron ore price estimates and Casablanca Capital sent a letter to shareholders asking for support for its board nominees.
Deutsche Bank expects iron ore prices to average $105 a ton for 2014, down from an earlier estimate of $118 a ton, and $135 a ton in May. The bank expects iron ore prices of about $90 a ton in 2015, down 21% from its earlier estimate.
Also contributing to the loss is a letter sent to Cliffs Natural shareholders by Casablanca Capital, asking them to support the firm's six board nominees.
"We believe Cliffs needs to refocus on its core U.S. Iron Ore business, improve operating profitability and optimize capital allocation," Casablana wrote. "The U.S. Iron Ore business, which has operated in some form for over 165 years, has high strategic value and, we believe under the right leadership, should remain profitable even in a depressed commodity pricing environment."
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TheStreet Ratings team rates CLIFFS NATURAL RESOURCES INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CLIFFS NATURAL RESOURCES INC (CLF) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and weak operating cash flow."