Cleveland-Cliffs can now buy back scrap metal directly from its clients
Cleveland-Cliffs Inc (NYSE:CLF) is in the spotlight today, after announcing a new acquisition that will see the steel and iron producer enter the scrap metal business. Specifically, Cleveland-Cliffs will now be able to purchase scrap metal back from its clients, after it acquired Ferrous Processing and Trading in a deal worth roughly $775 million. The deal is expected to close in the fourth quarter of 2021.
At last check, CLF is up 4.7% at $21.60. The last time we looked into the equity, Cleveland-Cliffs stock had pulled back to the 160-day moving average, which previously launched the shares nearly 45% on the charts within a month. It remains to be seen if this will happen again, as CLF has meddled below the $21 for much of the time since, though it boasts a 41.7% year-to-date lead.
Call traders are tripping over themselves to get in on the action. In the first hour of trading, over 20,000 calls have crossed the tape so far -- double what's typically seen at this point -- in comparison to 4,845 puts. The October 22 and 21.50 calls are the most popular by far, hinting at the upside these traders see for Cleveland-Cliffs stock by the week's end.