Ron Bloom, a director at
Cleveland Cliffs (CLF), recently bought 25,000 shares. The buy increased his stake by over 1,000 percent, and came to a total cost of $506,095.
This marks the first insider activity since last May, when another company director bought 10,000 shares, paying just under $150,000 to do so. The company President and CEO was a buyer last year, picking up about $1.6 million in shares overall.
In total, Cleveland Cliffs insiders own 1.6 percent of shares.
The steel producer is down 7 percent over the past year, reflecting some uncertainty as to the strength of the economy, especially regarding physical goods and construction.
Revenues are up a scant 1.3 percent, reflecting anemic growth in steel demand. And CLF hasn’t reported a profit in the most recent quarter.
However, the economy is holding up well. And construction demand remains strong, as does infrastructure spending. Both bode well for steel use in the years ahead.
Action to take: Investors may want to consider shares now, as they’re in a longer-term uptrend from last summer. At present, Cleveland Cliffs does not pay a dividend.
For traders, The April $22 calls, last going for about $0.68, could see mid-double-digit returns or better on a continued rally higher for shares.
Traders should look to take a quick profit on any big jump higher in shares given the volatility in commodity stocks.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.
