Cleveland-Cliffs (CLF) Upgraded to Overweight as Steel Prices Surge 44% in 2026

TLDR

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Wells Fargo elevated Cleveland-Cliffs from Equal Weight to Overweight, pushing the price target from $12 to $14.
Shares of CLF gained approximately 1%, reaching $12.30 during Tuesday’s session.
Analyst Timna Tanners anticipates EBITDA results in late 2026 and 2027 will surpass current Street expectations.
Hot rolled coil prices have surged from approximately $900 to $1,300 per ton year-to-date.
Just 25% of covering analysts recommend CLF as a Buy, significantly below the 55-60% average for S&P 500 constituents.

Shares of Cleveland-Cliffs advanced roughly 1% to $12.30 during Tuesday trading following an upgrade from Wells Fargo. Timna Tanners, the firm’s analyst, raised her stance to Overweight from Equal Weight while increasing her price objective to $14 from a previous $12.

Cleveland-Cliffs Inc., CLF

According to Tanners, the steelmaker’s financial performance has the potential to “materially exceed” prevailing analyst projections. She highlighted the latter half of 2026 and full-year 2027 EBITDA as timeframes when this outperformance may become evident.

Consensus estimates currently project approximately $1.3 billion in aggregate Q2 and Q3 EBITDA for this year. Looking ahead to 2027, analyst forecasts center around $2.3 billion.

To put these figures in perspective, Cliffs achieved $5.3 billion in EBITDA during 2021, marking its strongest annual result. During that period, steel prices reached approximately $1,900 per ton.

Steel Market Dynamics Shift Higher

Hot rolled coil benchmark pricing began 2026 near the $900 per ton mark. Since then, prices have climbed to roughly $1,300 per ton, expanding the company’s profitability potential.

Wells Fargo noted that hot rolled coil delivery lead times have reached levels comparable to those seen during the pandemic. Supply constraints are making it difficult for purchasers to secure material promptly.

In Houston, U.S. landed hot rolled coil pricing has increased by approximately $235 per ton since tensions involving Iran escalated. By contrast, Southeast Asian prices—frequently referenced as a global indicator—have risen only $35 per ton over the same period.

Tanners characterized this recommendation as a tactical position rather than a structural thesis. She believes the steel pricing cycle is approaching its peak, yet Cleveland-Cliffs has not yet fully realized the financial impact.

Looming Capacity Expansion Creates Uncertainty

CLF stock dipped as low as $11 last week, representing roughly a 5% decline from levels prior to President Trump’s endorsement of a new steel production facility in Iowa.

Mesabi Metallics is developing a $15 billion fully integrated steelmaking complex in the state. Upon completion, the facility is expected to produce between eight and nine million tons of finished steel annually.

This capacity represents a meaningful addition to the U.S. steel landscape, which currently generates 80 to 90 million tons per year domestically while importing an additional 20 to 25 million tons. This new volume could either displace foreign imports or intensify competition among domestic manufacturers.

However, the facility remains several years from operational status. For the time being, Cliffs’ valuation hinges on immediate EBITDA prospects rather than distant competitive threats.

Among analysts covering Cliffs, only 25% currently assign a Buy rating. This contrasts with the typical S&P 500 component, where Buy ratings generally account for 55-60% of analyst opinions.

That said, sentiment has improved incrementally. During the summer months, merely two analysts maintained Buy ratings on the shares. That figure has since doubled to four.

The consensus price target among analysts stands at approximately $13, up from about $12 one year ago.

Cleveland-Cliffs is scheduled to release quarterly results in 13 days. The company’s most recent report showed revenue of $5.2 billion, in line with projections, while posting a per-share loss of $0.20, marginally wider than the anticipated $0.19 deficit.

Wells Fargo also highlighted cost pressures as the primary concern cited by management teams during the previous reporting cycle. The investment bank continues to favor aluminum equities and copper producer Freeport-McMoRan over steel names for long-term positioning.

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