POSCO is trading at a price to book ratio of 1.02

(Reuters) - POSCO , the world's No. 3 steelmaker, expects its operating profit in 2011 to be higher than last year's helped by product price hikes, despite high raw material costs, its CFO said on Friday.

"We achieved 5.3 trillion won ($4.9 billion) in operating profit last year. And we expect this year's profit to exceed that level," POSCO CFO Choi Jong-tae told analysts.

($1 = 1080.950 Korean Won) (Reporting by Hyunjoo Jin; Editing by Jonathan Hopfner)

 

Monday, May 16, 2011

Potential Takeover Target (NYSE: PKX)

Shares of PKX fell by 0.45% or $-0.48/share to $105.20. POSCO is trading at a price to book ratio of 1.02. This indicates that the shares are relatively cheap compared to book value which means the market is pricing in going concern value. The PEG is 0.92 suggesting that the shares are trading at an excellent value relative to firm's growth rate. The price to sales ratio came in at 0.58. Hence, the firm is extremely cheap relative to its top line sales figures. on average, 393827 shares of PKX exchange hands on a given day and today's volume is recorded at 80277. These factors combined make this company a prime takeover candidate. Lookout for any takeover chatter or takeover news regarding this stock as one of the bigger players may have an eye on this one.

POSCO is an integrated steel producer in Korea. It produced approximately 33.

 

 

Dow Jones reported that POSCO's Board decided to join a final round of bidding to acquire a controlling stake in The Korea Express Co., Ltd. and also decided to invest in a 20% stake in a steel mill project in Brazil. The Board's decisions come after Posco pledged to spend KRW2 trillion ($1.8 billion) in new-growth businesses and mergers and acquisitions this year as part of its plan to seek overseas assets and diversify its businesses to help improve efficiency. The final auction of a 37.6% stake in Korea Express has been delayed to June from the originally planned May 13 due to disputes among bidders over whether Korea Express units could be purchased separately from the stake offered by Asiana Airlines, Inc. and Daewoo Engineering & Construction Co., Ltd., the main shareholders of the firm. In addition to the possible stake in Korea Express, Posco's board decided to invest in the $4 billion steel plant that fellow South Korean company Dongkuk Steel Mill Co., Ltd. will build in Brazil, but didn't specify the size of its investment.