Time to bail out on Korea Electric is now

This piece will recap Korea Electric. I will analyze why Korea Electric investors may still consider a stake in the business. The company Piotroski F Score is 3 - Frail. Considering 30-days investment horizon, Korea Electric is expected to generate 2.55 times more return on investment than the market. However, the company is 2.55 times more volatile than its market benchmark. It trades about 0.06 of its potential returns per unit of risk. The market is currently generating roughly 0.0 per unit of risk. We consider Korea Electric somewhat reliable. Korea Electric Power has Sharpe Ratio of 0.0605 which conveys that the firm had 0.0605% of return per unit of risk over the last 1 month. Our philosophy towards estimating volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Korea Electric which you can use to evaluate future volatility of the firm. Please verify Korea Electric Power Corporatio Mean Deviation of 1.09, Risk Adjusted Performance of 0.0256 and Downside Deviation of 1.39 to check out if risk estimate we provide are consistent with the epected return of 0.0963%.
Published over a year ago
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Reviewed by Michael Smolkin

KOREA ELECTRIC PW has about 6.37B in cash with 8.15B of positive cash flow from operations. This results in cash-per-share (CPS) ratio of 4.96. This firm dividends can provide a clue to current valuation of the stock. Korea Electric is not expected to issue dividends this year as it trying to preserve or re-invest any of the funds available for distribution to stakeholders. Lets now check Korea Electric Shares Outstanding. Based on latest financial disclosure Korea Electric Power Corporatio has 1.28B of shares currently outstending. This is 26.95% higher than that of the Utilities sector, and 65.54% lower than that of Utilities - Regulated Electric industry, The Shares Outstanding for all stocks is 123.85% lower than the firm.
Investing in Korea Electric, just like investing in any other equity instrument, is characterized by a strong risk-return correlation. High risks mean high returns and low risk means lower expected returns. Risk management is the act of identifying and assessing the potential risk and developing strategies to minimize these risks and earn maximum possible profits while holding Korea Electric along with other instruments in the same portfolio. Using conventional technical analysis and fundamental analysis to select individual securities into a portfolio complements risk management and adds value to overall investors' investing strategies.
Sophisticated investors, who have witnessed many market ups and downs, anticipate that the market will even out over time. This tendency of Korea Electric's price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Korea Electric. Your research has to be compared to or analyzed against Korea Electric's peers to derive any actionable benefits. When done correctly, Korea Electric's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy toward taking a position in Korea Electric Power.

How important is Korea Electric's Liquidity

Korea Electric financial leverage refers to using borrowed capital as a funding source to finance Korea Electric Power ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Korea Electric financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Korea Electric's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Korea Electric's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Korea Electric's total debt and its cash.

Korea Electric Gross Profit

Korea Electric Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Korea Electric previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Korea Electric Gross Profit growth over the last 10 years. Please check Korea Electric's gross profit and other fundamental indicators for more details.

Korea Electric Correlation with Peers

Investors in Korea can reduce exposure to individual asset risk by holding a diversified portfolio of assets in addition to a long position in Korea Electric Power. Diversification will allow for the same portfolio return with reduced risk. The correlation table of Korea Electric and its peers is a two-dimensional matrix that shows the correlation coefficient between pairs of securities Korea is related in some way. The cells in the table are color-coded to highlight significantly positive and negative relationships. Each cell shows the correlation between one pair of equities and can be used to run pair trading strategies or create efficient portfolios with your current brokerage. Please check volatility of Korea for more details

What is driving Korea Electric Investor Appetite?

The current investor indifference towards the small price fluctuations of Korea Electric Power Corporatio may raise some interest from investors. The Stock closed today at a share price of 10.91 on 116205 in trading volume. The company executives did not add any value to Korea Electric Power investors in July. However, most investors can still diversify their portfolios with Korea Electric Power Corporatio to hedge your portfolio against high-volatility market scenarios. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 1.5929. The below-average Stock volatility is a good sign for a longer term investment options and for buy-and-hold investors. Korea Electric preserves 122.88x of price to earning. Korea Electric is selling for 10.97. This is 2.75 percent decrease. Today highest was 11.36. Korea Electric Current Assets is very stable at the moment.
Book Value per ShareAsset Turnover
 2008 0.00  0.00 
 2009 0.00  0.00 
 2018 0.00  0.00 
 2019 (projected) 0.00  0.00 
To summarize, our analysis show that Korea Electric Moves totally opposite to market. The corporate body is undervalued and projects chance of bankruptcy close to average for the next 2 years. Our concluding 'Buy vs. Hold vs. Sell' recommendation on the corporate body is Hold.

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Rifka Kats do not own shares of Korea Electric Power. Please refer to our Terms of Use for any information regarding our disclosure principles.

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