While comparing the current values of a company's valuation multiples, such as price-to-earnings (P/E), price-to-sales (P/S), and price-to-cash flow (P/CF), with its own historical values helps determine whether its stock is fairly valued, overvalued, or undervalued, comparing the company relative to its peers on these parameters gives a good sense of the reasonability of the stock's price. Cleveland-Cliffs (NYSE:CLF) has risen 14% year-to-date, but the stock increasingly looks like a Fear given its weak operating performance and financial condition. Despite strength in metals pricing and improving demand trends, the company’s operational leverage makes it highly exposed to cyclical swings, and even modest pullbacks in steel prices could hit earnings hard. Macro factors impacting clf stock price include the Federal Reserve's interest rate stance. Softer rates could lower capital costs, encouraging industrial expansion and steel demand.
