Long term play: Korea Electric Power Corporation (ADR) (US: KEP)

Discussion in 'Stocks' started by Absolute, Apr 23, 2006.

  1. Absolute

    Absolute

    I stumbled across this seemingly awesome stock last night and thought I'd share it with you guys and hear your thoughts as well.

    The sheer numbers of this company really impressed me:

    Who likes a monopoly? I do.

    Korea Electric Power Corporation (KEPCO) is an integrated electric utility company, and is engaged in the transmission and distribution of electricity in Korea. As of December 31, 2004, the Company and its generation subsidiaries owned approximately 89.9% of the total electricity generating capacity in Korea

    5%/Insider Ownership (%) = 60%
    The insiders are heavily invested in this company.

    Sales (Qtr vs year ago qtr) = 23.6% compared to an industry average 16.60%. Sure there's an energy boom in this industry, but this company has the clear advantage in earning the sales. The Net Income (5-Year Annual Avg.)of 19.39 is nearly double that of the industry 10.02. So this company has a clear visible advantage.

    Annual EPS Growth - 19.39% Earnings are booming.

    P/E/G Ratio - This is Lynch's ratio that he likes and stocks with a PEG lower than or equal to .5 are considered awesome by this ratio and stocks with a PEG lower than 1 are considered good . KEP has a PEG of .51, which is pretty close to the desired .5 or lower ideal PEG. Very strong signal here.

    Debt/Equity Ratio 0.38
    Sounds like nice financial condition to me... very little debt.

    Here's where you go WHOA Book Value/Share 31.46
    Stock price: 23.24. This stock technically costs -8.22 to buy.

    Net profit margin = 12% CHA-CHING...


    LTD/Assets was 0.20 in the most recent year and 0.22 last year This company is poised in a more stable financial condition and is improving its debt as well as asset situation meaning it's much safer for investors.

    P/E 9.90 - this stock is cheap for the price it's at.

    KEP's RoA (return on assets) was 4.73% in the most recent year and 4.54% in the year before that. This company is returning more on assets, sounds good. Not to mention that a 4.5%+ RoA is pretty good.

    Earnings per share
    2006 2005 2004
    1st Qtr $0.58 $0.72 $0.85
    2nd Qtr $0.58 $0.27 $0.49
    3rd Qtr NA $0.48 $0.70
    4th Qtr NA $0.70 -0.04

    Positive earnings per share in last 9 quarters -- sounds nice.

    This was pretty rudimentary analysis and I apologize, but thought I'd post it and see what others thoughts were. Seems like a really solid stock with a niche that it is dominating.
    :)