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S&P 500 (NYSE:SPY) component Cliffs Natural Resources (NYSE:CLF) will unveil its latest earnings on Wednesday, October 24, 2012. Cliffs Natural Resources is an international mining company that operates primarily in North America and Australia.
Cliffs Natural Resources Earnings Preview Cheat Sheet
Wall St. Earnings Expectations: The average estimate of analysts is for net income of $1.09 per share, a decline of 76% from the company’s actual earnings for the same quarter a year ago. During the past three months, the average estimate has moved down from $2.35. Between one and three months ago, the average estimate moved down. It also has dropped from $1.18 during the last month. Analysts are projecting profit to rise by 60.4% versus last year to $4.65.
Past Earnings Performance: The company beat estimates last quarter after falling short in the prior two. In the second quarter, the company reported profit of $1.81 per share versus a mean estimate of net income of $1.75 per share. In the first quarter, the company missed estimates by 27 cents.
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A Look Back: In the second quarter, profit fell 36.7% to $258 million ($1.81 a share) from $407.7 million ($2.92 a share) the year earlier, but exceeded analyst expectations. Revenue fell 10% to $1.63 billion from $1.81 billion.
Wall St. Revenue Expectations: Analysts are projecting a decline of 18.7% in revenue from the year-earlier quarter to $1.74 billion.
Stock Price Performance: Between October 12, 2012 and October 18, 2012, the stock price rose $5.29 (13.1%), from $40.50 to $45.79. The stock price saw one of its best stretches over the last year between August 2, 2012 and August 9, 2012, when shares rose for six straight days, increasing 11% (+$4.44) over that span. It saw one of its worst periods between February 8, 2012 and February 22, 2012 when shares fell for 10 straight days, dropping 14.2% (-$10.85) over that span.
On the top line, the company is looking to get back on the right track after last quarter’s drop snapped a string of revenue increases. Revenue rose 59.2% in the third quarter of the last fiscal year, 16.7% in the fourth quarter of the last fiscal year and 6.9%in the first quarter before dropping in the second quarter.
An income boost this time around would be welcome news after profit drops in the past three quarters. Net income fell 49.5% in the fourth quarter of the last fiscal year, by 11.2% in the first quarter and again in the second quarter.
Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.14 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.15 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 10.8% to $1.53 billion while assets rose 9.8% to $1.74 billion.
Analyst Ratings: There are mostly holds on the stock with 10 of 16 analysts surveyed giving that rating.
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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)
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