BMO Capital Markets Downgrades Cliffs Natural Resources; Cuts PT 46% (CLF)

BMO Capital Markets reported on Tuesday that it has downgraded natural resources company, Cliffs Natural Resources Inc(CLF) to a “Market Perform.”

The firm has lowered their rating on CLF from an “Outperform” to a “Market Perform,” and has reduced the company’s price target by -46% from $50 to $27. This price target suggests a 10% upside to the stock’s current price of $24.13.

An analyst from the firm commented, “CLF has issued 9M ordinary shares and 27M depositary shares. Whilst strengthening the balance sheet, shareholders are effectively being asked to pay for the company’s poor performance. CLF sees no improvement to costs at Bloom Lake near term, forecasting cash costs of US$85–90/t in 2013. Capex for 2013 has increased to US$800–850M from US$700–800M previously. Prudently, CLF has significantly reduced the dividend to US$0.15 per quarter.”

Cliffs Natural Resources shares were up 28 cents, or 1.18% during Tuesday morning trading. The stock has dropped -61% in the past year.

The Bottom Line
Shares of Cliffs Natural Resources Inc(CLF) have a 2.49% yield, based on Tuesday morning’s price of $24.09.

Cliffs Natural Resources Inc(CLF) is not recommended at this time, holding a DARS™ Rating of 3.0 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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