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The Trump administration has rolled back tougher fuel-economy rules for vehicles. The new standard requires an average of 34.5 miles per gallon by 2031, a sharp drop from the previous target of over 50 miles per gallon.
This change matters because Cleveland-Cliffs is a major supplier of high-end steel used in electric vehicles and power grids. Lower fuel-economy requirements often slow the shift toward electric cars, which could reduce the immediate need for the specialized, high-margin electrical steels that the company has been betting its future on.
Source: WSJ
President Trump is expected to announce a plan by Mesabi Metallics to invest about 15 billion dollars in a new steel facility in Iowa. This would be the largest steel plant in the country and is aimed at starting production by 2030.
For Cleveland-Cliffs, this represents a potential long-term threat to its dominance in the domestic market. While the plant is years away from producing steel, a massive increase in U.S. capacity can lead to lower prices across the industry if demand does not grow fast enough to match it.
Source: CNBC
GLJ Research raised its price target for the stock from 15.60 to 17.48 dollars while keeping its buy rating. This suggests the firm sees more room for the stock to rise than it did previously. Other analysts have been more cautious lately, with the average target across all firms sitting at 12 dollars. While one firm's target change is routine, it highlights a divide between those who see a recovery coming and the broader group that expects the stock to stay near its current price.
Source: GLJ Research
Management has built a reliable streak of small beats over the last year, showing they have a firm handle on their costs even as the business works through a period of losses.
| Expectation | |
|---|---|
| EPS | $0.22 |
| Revenue | $5.70B |
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