The following are today's upgrades for Validea's Contrarian Investor model based on the published strategy of David Dreman . This contrarian strategy finds the most unpopular mid- and large-cap stocks in the market and looks for improving fundamentals.
POSCO (ADR) ( PKX ) is a large-cap value stock in the Iron & Steel industry. The rating according to our strategy based on David Dreman changed from 63% to 71% based on the firm's underlying fundamentals and the stock's valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: POSCO is a Korea-based company principally engaged in the manufacture and distribution of steel products. The Company operates in four segments: steel, trading, construction, and others. The steel segment includes production of steel products and sale of such products. The trading segment consists of global trading activities of POSCO Daewoo Corporation, exporting and importing a range of steel products that are both obtained from and supplied to it, as well as between other suppliers and purchasers in Korea and overseas. The construction segment includes planning, designing and construction of industrial plants, civil engineering projects, and commercial and residential buildings, both in Korea and overseas. The others segment includes power generation, liquefied natural gas ( LNG ) logistics, and network and system integration.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
|MARKET CAP: ||PASS |
|EARNINGS TREND: ||PASS |
|EPS GROWTH RATE IN THE IMMEDIATE PAST AND FUTURE: ||FAIL |
|P/E RATIO: ||PASS |
|PRICE/CASH FLOW (P/CF) RATIO: ||PASS |
|PRICE/BOOK (P/B) VALUE: ||PASS |
|PRICE/DIVIDEND (P/D) RATIO: ||PASS |
|CURRENT RATIO: ||FAIL |
|PAYOUT RATIO: ||PASS |
|RETURN ON EQUITY: ||FAIL |
|PRE-TAX PROFIT MARGINS: ||FAIL |
|YIELD: ||PASS |
|LOOK AT THE TOTAL DEBT/EQUITY: ||FAIL |
For a full detailed analysis using NASDAQ's Guru Analysis tool, click here
Since its inception, Validea's strategy based on David Dreman has returned 105.78% vs. 192.43% for the S&P 500. For more details on this strategy, click here
About David Dreman : Dreman's Kemper-Dreman High Return Fund was one of the best-performing mutual funds ever, ranking as the best of 255 funds in its peer groups from 1988 to 1998, according to Lipper Analytical Services. At the time Dreman published Contrarian Investment Strategies: The Next Generation, the fund had been ranked number one in more time periods than any of the 3,175 funds in Lipper's database. In addition to managing money, Dreman is also a longtime Forbes magazine columnist.
About Validea : Validea is an investment research service that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here