POSCO Holdings: A Value Stock With Consistent Profitability

Summary

• POSCO Holdings is undervalued, trading at less than half its tangible book value, despite consistent profitability and a strong balance sheet.
• The company maintains profitability during difficult steel markets through diversification, with significant potential in its battery materials business.
• POSCO believes it is past the worst of this steel down cycle, with expected earnings improvement in 2025 and potential growth from cost-cutting and new duties on Chinese steel.
• POSCO returns 50% to 60% of free cash flow to shareholders through dividends and buybacks.

While POSCO Holdings is primarily thought of as a steel company, their growing battery materials business offers upside.

Just_Super

POSCO Holdings (NYSE:PKX) is currently a classic value stock, trading at less than half its tangible book value despite never

Analyst’s Disclosure:I/we have a beneficial long position in the shares of PKX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I initially opened a position in PKX on 2/4/22 at $55.69 per share. I sold a little under half of my shares on 7/5/23 for $131.71 per share. I purchased more than 1.5 times the number of shares of my initial position on 1/31/25 at $44.50 per share.