The Korean cosmetics names had a strong run yesterday after been hit hard with the concern of slowdown revenue growth in China after Cosmax (192820 KS), one of the largest cosmetics Original Equipment manufacturers in Korea, had released disappointing result. With evidence of KOSDAQ’s weakness, a number of high P/E names are sold off and switched into value names. From OTAS we could see a few positive signals for opportunities to buy at this level:
LG Household & Healthcare (051900 KS), one of the largest cosmetic brand names in Korea, had a huge volume bargain hunt by foreign yesterday with its ADV being historically high. Yesterday’s volume was 101.5k and the 30 days ADV is 47.7k:
Its valuation looks appealing again. The 12 month forward P/E valuation of 24.4x is gradually coming down to an inexpensive level over the past six months:
In terms of OTAS Technical signals, an OTAS Full Stochastic (+) signal was fired upon yesterday’s close, which on average generates 4.3% return over the following 20 trading days and its success rate is as high as 72% of the time since 2006:
