CLF Intrinsic Value

CLF

Cleveland-Cliffs Inc – Iron Ore Mining

arcelormittal usa is part of arcelormittal, the world’s leading steel and mining company. guided by a philosophy to produce safe, sustainable steel, we are a leading supplier of quality steel products in major north american markets including automotive, construction, pipe and tube, appliance, container and machinery. arcelormittal usa employs more than 20,000 people at 27 operations across 13 of the united states. we aim to give our employees every chance to flourish in their careers and grow as part of a global company. we offer a wealth of diverse opportunities. whether you work in production in pennsylvania or as a purchaser in indiana, joining arcelormittal is the start of a journey that, we hope, will lead to a rewarding career. we are always looking for the best and brightest minds to help us transform the future of steel.

Analysis Results

Intrinsic Value	$97.70
Latest Price	$14.46
Relative Value	85% undervalued

Share results:

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Cash Flow (Billions)

Analysis Parameters

New Ticker

Analysis Details

Growth Rate Projection

An exponential growth model was fit to the past cash flow data, giving more weight to more recent years. This model determined a growth rate estimate of 21.8%.

Weighted Average Cost of Capital (WACC)

The calculated WACC is 9.8%. This value is used as the default discount rate.

Value of Future Flows

Assuming a growth rate of 21.8%, the cash flows for the next 5 years are projected.

The present value of each year's flow is adjusted to present value using the discount rate.

Year	Future flow (billion)	Present value (billion)
2023	2.25	2.05
2024	2.74	2.27
2025	3.34	2.52
2026	4.07	2.8
2027	4.95	3.1

Terminal Value

Assuming a growth rate after the projection years of 2.0%, the terminal value of the company would be 64.8 billion. This corresponds to a present value of 37.0 billion.

Intrinsic Value Per Share

The total present value of the projected cash flows is 12.7 billion. Adding in the terminal value gives a total present value of 49.7 billion.

There are presently 509.0 million outstanding shares, so the intrinsic value per share is 97.7.

Financial Statements

The following data was to determine the past cash flows.

Current Assets	7,422,000,000
Current Cash	26,000,000
Current Liabilities	3,549,000,000
Current Debt	0
Non-Cash Working Capital (NCWC)	3,847,000,000
Change in NCWC	-197,000,000
EBIT	2,053,000,000
Tax Provision	423,000,000
Depreciation and Amortization	1,034,000,000
Capital Expenditure	-943,000,000
Unlevered Free Cash Flow	1,463,470,489

Current Assets	7,653,000,000
Current Cash	48,000,000
Current Liabilities	3,561,000,000
Current Debt	0
Non-Cash Working Capital (NCWC)	4,044,000,000
Change in NCWC	1,787,000,000
EBIT	4,112,000,000
Tax Provision	773,000,000
Depreciation and Amortization	897,000,000
Capital Expenditure	-705,000,000
Unlevered Free Cash Flow	5,255,192,479

Current Assets	5,298,000,000
Current Cash	112,000,000
Current Liabilities	2,929,000,000
Current Debt	0
Non-Cash Working Capital (NCWC)	2,257,000,000
Change in NCWC	2,121,100,000
EBIT	8,000,000
Tax Provision	-111,000,000
Depreciation and Amortization	308,000,000
Capital Expenditure	-525,000,000
Unlevered Free Cash Flow	1,912,100,000

Current Assets	897,900,000
Current Cash	352,600,000
Current Liabilities	409,400,000
Current Debt	0
Non-Cash Working Capital (NCWC)	135,900,000
Change in NCWC	-52,300,000
EBIT	456,300,000
Tax Provision	17,600,000
Depreciation and Amortization	85,100,000
Capital Expenditure	-639,000,000
Unlevered Free Cash Flow	-175,631,752

Current Assets	1,479,600,000
Current Cash	823,200,000
Current Liabilities	468,200,000
Current Debt	0
Non-Cash Working Capital (NCWC)	188,200,000
Change in NCWC	103,500,000
EBIT	692,800,000
Tax Provision	-475,200,000
Depreciation and Amortization	89,000,000
Capital Expenditure	-208,600,000
Unlevered Free Cash Flow	676,700,000

Current Assets	1,544,600,000
Current Cash	1,007,700,000
Current Liabilities	452,200,000
Current Debt	0
Non-Cash Working Capital (NCWC)	84,700,000
Change in NCWC	-25,400,000
EBIT	395,900,000
Tax Provision	-252,400,000
Depreciation and Amortization	87,700,000
Capital Expenditure	-151,700,000
Unlevered Free Cash Flow	306,500,000

Current Assets	824,600,000
Current Cash	323,400,000
Current Liabilities	391,100,000
Current Debt	0
Non-Cash Working Capital (NCWC)	110,100,000
Change in NCWC	-5,700,000
EBIT	271,500,000
Tax Provision	-12,200,000
Depreciation and Amortization	115,400,000
Capital Expenditure	-69,100,000
Unlevered Free Cash Flow	312,100,000

Current Assets	982,700,000
Current Cash	285,200,000
Current Liabilities	581,700,000
Current Debt	0
Non-Cash Working Capital (NCWC)	115,800,000
Change in NCWC	-179,900,000
EBIT	126,400,000
Tax Provision	169,300,000
Depreciation and Amortization	134,000,000
Capital Expenditure	-80,800,000
Unlevered Free Cash Flow	-68,669,073

Current Assets	1,448,900,000
Current Cash	290,900,000
Current Liabilities	958,600,000
Current Debt	96,300,000
Non-Cash Working Capital (NCWC)	295,700,000
Change in NCWC	135,800,000
EBIT	224,000,000
Tax Provision	-1,302,000,000
Depreciation and Amortization	504,000,000
Capital Expenditure	-284,100,000
Unlevered Free Cash Flow	579,700,000

Current Assets	1,560,000,000
Current Cash	335,500,000
Current Liabilities	1,085,500,000
Current Debt	20,900,000
Non-Cash Working Capital (NCWC)	159,900,000
Change in NCWC	-7,500,000
EBIT	784,300,000
Tax Provision	55,100,000
Depreciation and Amortization	593,300,000
Capital Expenditure	-861,600,000
Unlevered Free Cash Flow	404,342,540

Current Assets	1,650,000,000
Current Cash	195,200,000
Current Liabilities	1,381,500,000
Current Debt	94,100,000
Non-Cash Working Capital (NCWC)	167,400,000
Change in NCWC	316,800,000
EBIT	342,000,000
Tax Provision	255,900,000
Depreciation and Amortization	525,800,000
Capital Expenditure	-1,127,500,000
Unlevered Free Cash Flow	57,100,000

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