April 20, 2024

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[THE INVESTOR] POSCO’s earnings will pick up in the third quarter, said Yuanta Securities Korea on Sept. 4, maintaining a “buy” recommendation and 470,000 won (US$422.66) target price. 

Carbon steel spread will improve as average the price rises while commodity prices fall. The fixed costs per ton will decline from eliminating one-off costs as well. Share of exports has been declining since 2016 but still contributes close to 40 percent, and export price increase from weak Korean won will help boost its earnings, said analyst Lee Hyeon-su adding regardless of concerns over US-China trade conflicts, the Chinese steel industry remains solid. Concerns are dragging down the strong market and upward earnings momentum now but ease when the steel industry gains further as China cuts back manufacturing from October and expectations for POSCO rise, forecast the analyst. 

By Hwang You-mee (glamazon@heraldcorp.com)