Cleveland-Cliffs Experiences Increased Bearish Options Activity Amidst Financial Challenges and Market Sentiment Concerns

Cleveland-Cliffs (CLF) has seen increased bearish options activity, with 9,414 put options exchanged, exceeding the anticipated volume by 40%. The August 25 options with strike prices of $9 and $9.5 saw significant interest, accumulating nearly 6,400 contracts. The Put/Call Ratio stands at 3.45, indicating a strong preference for puts over calls. The company's financial health analysis reveals a 10.5% one-year revenue growth decline, negative margins, and a debt-to-equity ratio of 1.33. The Altman Z-Score of 1.08 places the company in the distress zone, and insider activity shows a trend of selling.

Cleveland-Cliffs Inc. (CLF) has witnessed a surge in bearish options activity, with 9,414 put options exchanged, surpassing the expected volume by 40% [1]. This significant interest is particularly evident in the August 25 options with strike prices of $9 and $9.5, which saw nearly 6,400 contracts traded [1]. The Put/Call Ratio stands at 3.45, indicating a strong preference for puts over calls, suggesting a pessimistic outlook among investors [1].

The company's recent financial health analysis reveals several concerning trends. Over the past year, Cleveland-Cliffs has experienced a 10.5% decline in revenue growth, negative margins, and a debt-to-equity ratio of 1.33 [2]. Additionally, the Altman Z-Score of 1.08 places the company in the distress zone, indicating a high probability of bankruptcy [2]. Furthermore, insider activity shows a trend of selling, which may signal a lack of confidence in the company's future prospects [2].

In light of these financial indicators, Cleveland-Cliffs faces significant challenges in maintaining its investment narrative. The company must navigate a complex landscape of industry headwinds, trade policy shifts, and the slow pace of decarbonization investments. Despite these challenges, Cleveland-Cliffs has announced the commissioning of a new Vertical Stainless Bright Anneal Line in Ohio, which could potentially offer revenue and product-mix relief in future quarters [2].

Investors should closely monitor Cleveland-Cliffs' financial performance and strategic initiatives to assess the company's ability to turn around its current trajectory. The company's projections for 2028 suggest a challenging path to profitability, with the need for annual revenue growth of 7.3% and a $2.27 billion increase in earnings from current levels [2].

References
[1] https://finance.yahoo.com/quote/CLF/options/
[2] https://simplywall.st/stocks/us/materials/nyse-clf/cleveland-cliffs/news/why-cleveland-cliffs-clf-is-up-207-after-q2-2025-losses-and
[3] https://www.marketbeat.com/instant-alerts/q3-earnings-forecast-for-cleveland-cliffs-issued-by-b-riley-2025-07-31/