Buying debt back at a discount does increase earnings as the difference between face value of the bonds and what they pay for them is applied to earnings. And remember, they had $3.5 billion in debt just a couple years ago. CLF is going in the right direction.
CLF's current and forward PE's are better than VALE and RIO. It may not be a record, but it will beat analyst expectations.
US Pellets are around a $30 premium to seaborne spot price. Their Mustang pellet line has a higher margin.
At the current cost to produce pellets, they would have to get iron ore pellets up to $97 a ton. At the current ratio of sea borne IO and US pellet cost, seaborne ore would have to be at $67 a ton.
Would say this if we had a trade surplus, we don't. Obamacare is our biggest drag on the economy and Hilary will expand it as more and more of the healthcare insurance groups pull out causing the government to pick up the shortfall. The only reason I would vote for Trump is his position on eliminating Obamacare.
They are the lowest cost producer of iron ore pellets in the US. This is why LG is spending much of his time now looking to expand their capacity.
What you have to look at is US demand and supply. With the downturn, many of CLF's direct competitors with iron ore pellets have left the market. So as steel demand increases with construction (40% of steel usage in the US) and autos remain stable (20% of steel usage), CLF is in a great position to capture this pellet demand. And with the huge drop in CLF's cost, recovery is going to proceed much faster.
I am not saying Trump is qualified, saying Hilary is not qualified. We really have no choices here. I just can't stand the typical political responses out of Hilary on this one.
I agree, Trump called it yesterday while Clinton had to wait until official notices. People want someone that can react fast to terrorist threat.
Yes, the Fed has been printing money at record levels and we have no inflation to show for it. The reason is this money is not getting out into the economy, it is just sitting on the balance sheets of banks to boost their reserves. Our current low interest rates is keeping money from entering into the economy as banks hold onto this cash at little or no cost to them.
And the Clintons take money from the rich, give money to charities and then keep some of that money themselves. This is the politics that Hillary holds dear.
On the other hand, I don't like the way Trump screwed people over through the countless trips to the Bankruptcy Courts.
When it really comes down to the nitty gritty, they both are very much alike!
Then why did their interest expense increase while their debt load went down? Look at 6/30/14 10 Q, they had $3.2 billion in debt and they paid $44.8 million in interest for the quarter. Now they spend over $50 million on $2.4 billion in debt. I looks like CLF has additional interest expense on the bonds they buy back that is charged to interest expense.