POSCO (NYSE: PKX) reported 1Q 2010 earnings yesterday. The South Korean company, one of the best steel manufacturers in the world, looks to have had another very solid quarter. I'm guessing that they will soon be earning at least $ 3.5 to 4.o billion/year.
Obviously, the steel business is very cyclical yet unlike many steelmakers, POSCO remained profitable in 2009. POSCO earned $ 2.82 billion in a year where most competitors lost money or struggled to break even. Impressive financial performance considering the economic stresses of 2009. In contrast, US Steel (NYSE: X) went from earning $ 2.1 billion in 2008 to losing $ 1.4 billion in 2009.
The market value of POSCO is ~$ 37 billion (@ the current ADR price of ~$ 121/share). Not cheap relative to earnings for a steel company but they appear to be a solid business within a tough industry.
Here is an article in the Wall Street Journal on POSCO's 1Q earnings. Net profit for the most recent quarter was $ 1.29 billion.
Small long position in POSCO
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