• If you are wondering whether Cleveland-Cliffs is priced attractively or not, the recent share performance gives you plenty of clues but not the full story.
• The stock last closed at US$10.65, with returns of 4.4% over 7 days, 22.3% over 30 days, a 21.7% decline year to date, and a 49.0% gain over the past year. This can leave the current value looking either appealing or stretched, depending on how you look at it.
• Recent price moves have come against a backdrop of ongoing attention on the steel and raw materials space, where investors often watch for shifts in demand, cost pressures, and capital allocation decisions. For Cleveland-Cliffs, this kind of context can influence how markets weigh its exposure to commodities against its balance sheet and future investment plans.
• Cleveland-Cliffs currently scores 3 out of 6 on our valuation checks. This sets up a closer look at how methods like DCF, multiples, and asset based measures line up, and why an even richer way of thinking about valuation can matter by the end of this article.

Approach 1: Cleveland-Cliffs Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a stock could be worth by projecting future cash flows and discounting them back to today using a required return. It is essentially asking what all those future dollars are worth in current terms.

For Cleveland-Cliffs, the model used is a 2 Stage Free Cash Flow to Equity approach. The latest twelve month free cash flow is a loss of about $1,029.6 million, so the starting point is negative. Analyst and extrapolated projections in the model show free cash flow moving to $333.5 million in 2028, with further estimates out to 2035 provided in millions of dollars. Simply Wall St uses analyst forecasts where available, then extends them to build a full 10 year cash flow path.

Discounting those projected cash flows back to today gives an estimated intrinsic value of about $6.18 per share, compared with the recent share price of $10.65. On this model, that equates to the stock trading around 72.2% above the DCF estimate, which points to a rich valuation on a pure cash flow basis.

Result: OVERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Cleveland-Cliffs may be overvalued by 72.2%. Discover 51 high quality undervalued stocks or create your own screener to find better value opportunities.

Approach 2: Cleveland-Cliffs Price vs Sales

For companies where earnings can be uneven, the P/S ratio is a useful way to think about value, because it focuses on how much investors are paying for each dollar of revenue rather than profit, which can swing with margins and one off items.

In general, higher growth expectations and lower perceived risk can support a higher “normal” P/S multiple. Slower expected growth or greater uncertainty tend to justify a lower one.

Cleveland-Cliffs currently trades on a P/S of 0.32x. This sits well below the Metals and Mining industry average of 2.45x and also below the peer group average of 1.82x. On those simple comparisons, the stock can look inexpensive.

Simply Wall St’s Fair Ratio metric aims to refine that picture. It estimates what a suitable P/S might be, given factors such as earnings growth, industry, profit margins, market cap and company specific risks.

For Cleveland-Cliffs, the Fair Ratio is 0.85x, which is higher than the current 0.32x P/S. That gap suggests the stock is trading below the level implied by these fundamentals based inputs.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your Cleveland-Cliffs Narrative

Earlier it was mentioned that there is an even better way to understand valuation. Narratives take center stage as a simple way for you to link your view of Cleveland-Cliffs to a financial forecast and then to a fair value. This is done by turning your story about tariffs, reshoring, decarbonization, revenue, earnings and margins into concrete estimates that can be compared with the current price, updated automatically when new earnings or news arrive, and shared on Simply Wall St’s Community page. Millions of investors already use tools like the AnalystConsensusTarget fair value of US$10.67, the more optimistic US$16.80 view and the more cautious US$8.90 view to decide whether their own Fair Value sits closer to the higher or lower end before choosing when they might prefer to buy or sell.

For Cleveland-Cliffs however we'll make it really easy for you with previews of two leading Cleveland-Cliffs Narratives:

Start by asking which story feels closer to how you see tariffs, decarbonization, auto demand, and the company’s balance sheet playing out, then see how that translates into fair value.

Fair value in this bullish narrative: US$10.67 per share.

Current price vs this fair value implies Cleveland-Cliffs is trading about 0.2% below that figure, so very close to fair value on this view.

Revenue growth assumption: 5.32% a year.

• Tariff protection, reshoring, and strong OEM relationships are expected to support higher domestic volumes, pricing power, and more predictable revenue.
• Cost reductions, vertical integration, and selective asset sales are aimed at improving free cash flow, lowering leverage, and lifting margins over time.
• Newer, higher margin specialty and stainless products linked to infrastructure, electrification, and clean energy projects are expected to broaden the revenue base, while heavy reliance on tariffs, blast furnaces, and auto demand remains a key risk.

Fair value in this cautious narrative: US$8.90 per share.

Current price vs this fair value implies Cleveland-Cliffs is trading about 19.7% above that figure.

Revenue growth assumption: 15.09% decline a year.

• Global moves toward steel recycling and decarbonization, along with growing EAF capacity and overcapacity, are expected to pressure demand for primary steel and weaken pricing power.
• High capital needs, aging assets, and heavy auto exposure leave earnings and free cash flow sensitive to weaker volumes, changing material use in vehicles, and any slowdown in auto production.
• Even with some support from tariffs, vertical integration, and premium products, this view assumes profitability and valuation multiples stay constrained, keeping the fair value well below the current share price.

If you want to see how other investors have connected these moving parts into a full story, including detailed assumptions on growth, margins, and tariffs, you can read the narratives in full and compare them with your own expectations using the See what the community is saying about Cleveland-Cliffs.

Do you think there's more to the story for Cleveland-Cliffs? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.