Cleveland-Cliffs' Big Bet Looks Like It Paid Off

Shares of Cleveland-Cliffs (NYSE: CLF) are up by around 200% since the start of 2020 -- a vastly better performance than the "mere" 34% rise of the S&P 500 Index over that period. There are a lot of moving parts to the story of why the steelmaker did so well, including a major corporate bet that paid off in a big way. But investors shouldn't get too comfortable about this stock.

At the start of 2019, Cleveland-Cliffs was a supplier to the steel industry, providing iron ore largely to North American steel producers. It wasn't a bad business, per se, but the domestic steel sector had been going through some rough times. Some of Cleveland-Cliffs' customers were struggling. By the end of 2019, it announced that it was going to buy one of those major customers -- AK Steel.

Image source: Getty Images.

Source Fool.com