CLF Stock: Cleveland-Cliffs Squeezes Higher on Infrastructure Hopes

Today, investors in Cleveland-Cliffs (NYSE:CLF) and CLF stock are seeing impressive gains. Currently, shares of this steel maker are up nearly 6% at the time of writing on a relatively flat day in the overall market.

Cleveland Cliffs (CLF) logo on an iPhone
Source: IgorGolovniov /

What’s intriguing about Cleveland-Cliffs is the amount of volatility this stock has seen in recent days. Indeed, most of the volatility has been due to the upside with this infrastructure-linked play. And this makes sense, given the amount of government support for infrastructure spending we’ve seen discussed of late. Accordingly, this is a stock that has been a five-bagger from its 52-week lows for patient investors who have bet on the infrastructure rally to take hold.

Unsurprisingly, today’s news surrounding the passing of President Joe Biden’s $1.2 trillion infrastructure bill has lifted all such infrastructure stocks. Let’s take a look at why investors are growing increasingly bullish on CLF stock today.

CLF Stock Higher on Expectations of Demand Boost

As a flat-rolled steel producer, Cleveland-Cliffs’ niche focus is something investors have latched onto with respect to Biden’s proposed spending bill. Seeing this bill approved and knowing that billions of dollars in spending for roads, bridges, rail, electric grid and power structures, and a range of other infrastructure is imminent should provide Cleveland-Cliffs with an impressive boost.

Biden’s focus on ensuring that the majority of the raw materials used for these projects are American-made is very beneficial for investors in CLF stock. Indeed, Cleveland-Cliffs is one of the largest players in its domain, with a market capitalization of $13 billion at the time of writing. Investors betting on a continued infrastructure push appear to be correctly factoring in higher cash flows over time from this steel maker.

Another key reason investors like CLF stock right now is the company’s recent deal with union workers. President Biden has been very outspoken about supporting unionization. Accordingly, Cleveland-Cliffs appears to be well-aligned with the government’s objectives. Thus, the idea that Cleveland-Cliffs will be a primary supplier for these projects is a popular one.

On top of this pretty important catalyst is the fact that retail investors have put their support behind CLF stock. It appears some momentum is building around the idea this stock could squeeze higher. Whether this is a self-fulfilling prophecy or not remains to be seen. However, this stock has certainly been trending in the right direction this past year.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

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