POSCO (ADR) (NYSE:PKX)
POSCO (ADR) (NYSE:PKX) manufactures steel products. Its products include hot rolled steels, steel plates, wire rods, cold rolled steels, galvanized steels, electrical galvanized steels, stainless steels and others. Posco’s products are used in ships, automobiles, consumer electronics, machine structures, general structures and others. In addition to importing and exporting steel products and raw materials, the company also designs and constructs commercial and residential buildings.
POSCO (ADR) (NYSE:PKX) is a very profitable company that has demonstrated the ability to grow at a healthy rate. Over the past 5 years, for instance, this company has grown its top line by an average of more than 21% a year. As a result, this company currently generates more than $200 in revenue per share each year. So if this company can cut some costs and improve its margins, it can become very profitable. And if earnings per share improve, then the company has a lot of room to increase its dividend yield, which is currently slightly above 3%. Especially if you consider that at a current dividend payout of $2.67 per share, Posco is only using 21% of its earnings to pay its dividend.
SK Telecom Co., Ltd. (ADR) (NYSE:SKM)
SK Telecom Co., Ltd. (ADR) (NYSE:SKM) provides cellular voice, wireless data, broadband internet, and fixed-line telephone services, including digital convergence and new businesses. The company’s wireless data services include wireless internet access that allows subscribers to access a range of online digital content and services and to send and receive text and multimedia messages using their mobile phones. Through the company’s subsidiary, SK Broadband, the company offers broadband internet access, video-on-demand, and IP television services, as well as local, domestic long-distance and international long-distance fixed-line telephone services to residential and commercial subscribers.
It appears that SK Telecom Co., Ltd. (ADR) (NYSE:SKM) faces the same challenges that every other telecom company faces, namely regulation, increased competition and margin compression. But SK Telecom is a stable company, is trading at a P/E ratio of around 8, and has a dividend yield of more than 5%. Even though I am admittedly biased towards some European telecom companies, this company doesn’t look that bad, particularly if it were to either pull back a little or raise its dividend.
Woori Finance Holdings Co., Ltd. (ADR) (NYSE:WF)
Woori Finance Holdings manages and supports its subsidiaries in their operations. Its subsidiaries are involved in the a range of businesses, including banking, securities, life insurance, credit card, asset management, consumer financing and investment fund businesses. The company provides its products and services to individuals as well as to corporations.
This company has a book value of $64.07, which means that it is currently trading at a price to book value of around 0.6. Furthermore, this company trades at a P/E ratio of approximately 4, pays a modest dividend of around 2%, and is well-positioned to benefit from a global recovery. On the downside, the performance of this company is highly correlated to the performance of U.S. economy, and its earnings and revenue growth appear to have slowed.
3 Factors to Consider
- South Korea has low unemployment and embraces free trade.
- South Korea’s economy is very dependent upon exports.
- South Korean companies will benefit disproportionately from a global recovery.
My Foolish Take
All factors considered, I think that South Korea is one of the best places to consider investing. Before investing in any one company, conduct thorough research. Even though these companies are trading on the NYSE, it is still challenging to find accurate information. You may want to consider purchasing an ETF such as iShares MSCI South Korea Capped Index.
The article Bargain Hunting in Korea originally appeared on Fool.com.
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