CLF Earnings Not As Shiny As the Stock Move Might Imply

Earnings, which are generally meaningless with all the accounting gimmicks came in better than expected, but the revenues missed by $52 million at $820 million vs. the expected $872 million. The reason for the price action could be the huge short interest in the stock leading to short covering. This is one of the poster children of momentum and bubble stocks. As much as it can be a good investment for the very very long term, for the short to medium term this is a terrible investment and way overvalued at current prices. Given the nature of bubble stocks, the way to play this is using puts possibly in the March to June range and at or slightly out of the money. The discount rate raise will not help commodity stocks either if you need another reason.