Even in the bull market we've seen in recent years, some stocks have fallen hard, and Cliffs Natural Resources (NYSE: CLF) has been among the worst performers in the stock market. The iron-ore producer has taken a big hit from the cyclical decline of the steel industry, where falling demand has led to rock-bottom prices for iron ore that, in turn, have transformed the market for the raw materials necessary for steel production. Even as the stock has plunged over the past several years, Cliffs Natural has at least a few bright spots that could lead to a rebound in its share price in the future. Let's look at three of the key factors that could push Cliffs Natural Resources' stock higher.

1. Insiders are buying.
One of the best sources of optimism about a company's stock comes when corporate insiders make purchases of shares. Over the past couple of weeks, several insiders at Cliffs Natural have bought the stock, with the biggest commitment coming from CEO Lourenco Goncalves. Goncalves reported two separate purchases totaling 200,000 shares, spending just over $1 million from his revocable trust and bringing his total holdings both within and outside the trust to about 564,000 shares. Other insiders have made smaller purchases, including board members Douglas Taylor and Michael Siegal.

Goncalves' purchases are important, though, as the CEO has aggressively promoted his strategic vision ever since taking the reins at Cliffs Natural last summer. He has made it clear that he believes pushing forward by emphasizing its strong position in the Great Lakes region is the best way to refocus the company to make best use of its competitive advantages.

Seeing Goncalves put his money where his mouth is should reassure shareholders that he believes Cliffs Natural stock is a profitable investment opportunity.

2. The future of direct reduced iron could give Cliffs a big growth opportunity.
The low price of raw iron ore has led some companies to pursue other ways of trying to add value in the commodity space. One such opportunity comes from direct reduced iron, which has become increasingly important as a potential source of growth for iron ore producers. Increasingly, steel mills are moving away from energy-intensive blast furnaces that can take raw low-grade taconite iron ore, instead preferring more energy-efficient electric-arc furnaces. That, in turn, requires that steel mills get higher-grade iron, and the exploration of direct reduced iron production facilities is one way Cliffs hopes to distinguish itself from overseas suppliers.

Specifically, Cliffs is looking to use its home-field advantage in the Iron Range region of Minnesota to offer supplies of direct reduced iron to the growing number of steel mini-mills in the region employing electric arc furnaces.

Already, steel producer Nucor has boosted its production of direct reduced iron with a plant of its own, and Goncalves believes that with 60% of U.S. steel production coming from electric-arc furnaces, taking Cliffs in the direction of making direct-reduced iron products caters to the larger portion of the industry and could also boost the company's financial prospects.

By negotiating with local government entities with the incentive of keeping more jobs in the region, Cliffs could end up getting good deals that could add to its potential profit from its strategic moves toward direct-reduced iron.

3. Cliffs Natural's reorganization is going better than some expected.
The flip side of Cliffs Natural's emphasis on the U.S. Midwest is that the company has worked hard to ramp down its exposure in other geographical areas. That work has gone better than many had expected, and costs have been lower than even Cliffs itself had initially anticipated.

For instance, when Cliffs Natural chose to shut down its Canadian facilities at Bloom Lake, it had originally thought it would cost between $650 million and $700 million in follow-up costs. Yet instead, Cliffs has successfully used legal proceedings in Canada to eliminate any potential liability at the parent-company level, with only the assets of the Bloom Lake facility itself remaining exposed to the claims of creditors. Similarly, Cliffs agreed to sell chromite assets in northern Ontario to Noront Resources earlier this year, and although the $20 million payment is a pittance compared to what the company originally paid for the property in what's known as the Ring of Fire region, it nevertheless prevents Cliffs from needing to put more capital toward maintaining and developing the project going forward.

Initiatives like these are small and might not seem like enough to counteract the overwhelming pessimism surrounding the global iron-ore industry. Yet they represent Cliffs Natural's best chance of survival, and if they succeed, they could help lift the company's share price higher after its long descent.

Dan Caplinger has no position in any stocks mentioned.