Earnings Preview For Cliffs Natural Resources (CLF)

Cliffs Natural Resources CLF is expected to announce its Q1 earnings report on Thursday, April 28, after the bells ring. Analysts are predicting earnings per share to skyrocket to $2.25, up 309.1% on the previous year's level of $0.55. A month ago, analysts were expecting even more astonishing earnings of $2.54 per share. Cliffs Natural Resources is a Cleveland-based international mining and natural resources company. The company is a producer of iron ore pellets in North America and metallurgical coal, and a supplier of direct-shipping lump and fines iron ore out of Australia. Its operations are managed into groups: North American Iron Ore; North American Coal; Asia Pacific Iron Ore; Asia Pacific Coal; Latin American Iron Ore; Alternative Energies; Ferroalloys; and Global Exploration Group. In North America, it operates six iron ore mines in Michigan, Minnesota and Eastern Canada, five metallurgical coal mines located in West Virginia and Alabama and one thermal coal mine located in West Virginia. On January 27, 2010, it acquired Freewest. On February 1, 2010, it acquired interests in Wabush, while on October 6 the same year, it acquired Spider. The first signs of global recovery have pushed analysts' expectations through the roof. Analysts are expecting revenues to rise 91.8% this quarter to $1.4 billion and earnings per share to be 309.1% higher than a year ago. On the other hand, these extraordinary gains could be interpreted more as a sign of Cliff's exceptionally bad Q1 performance last year. To that end, earnings per share in Q1 2010 was just a quarter of a value recorded in the rest of the year. Investors will be encouraged, however, by prospects of a strong growth in the rest of 2011 as well, though not at a three-digit pace. Revenues for the whole year are expected to rise by 38.4% and earnings per share by 68.5%. The rating agencies are optimistic about Cliff's performance as well, with the majority putting a Buy or Strong Buy rating on its shares. Investors will still probably be worried that the fragile economic recovery might take a sudden downturn, bringing with it the demand for natural resources, as well as Cliff's revenues.