PKX heads into its July 6 earnings release with a partial recovery underway — but options positioning reveals investors remain more defensive than they were just weeks ago.
The stock closed at $52.12 on July 2, up 4.2% on the day and recovering ground after a brutal month that saw it fall roughly 26%. That bounce matters: the prior earnings preview, published June 29, caught PKX at $49.96 and still sliding. The four-dollar move since then changes the price-action backdrop, even if the 30-day hole remains large. Options positioning has tightened further into the print. The put/call ratio has climbed to 0.53, nearly 1.8 standard deviations above its 20-day average of 0.42 — the highest defensive reading in roughly a year. A month ago, when the stock was rallying, the PCR ran as low as 0.13; investors have rotated decisively toward downside hedges since then.
The borrow market, however, has continued to ease — and the easing has accelerated. Availability has jumped to 434%, more than doubling over the past week alone, and borrowing costs have dropped to 0.53%, down 36% over the past month. That is a loose lending environment by any measure, and it reflects a meaningful unwind of short positioning: shares short have fallen 34% over the past week and 29% over the past month. The short score has also eased from a recent peak near 65 to 56, further confirming that bearish conviction in the stock has pulled back. These two signals — cautious options traders and retreating short sellers — point in opposite directions, which is itself the tension heading into Sunday's print.
The fundamental debate sits at an extreme. POSCO's price-to-book has compressed to roughly 0.46 and the forward EPS factor scores rank well: the company scores in the 80th percentile on EPS surprise and the 87th percentile on forward earnings growth trajectory. UBS upgraded the stock to Buy in late April, the only recent analyst action with current relevance — all other tracked moves predate 2020 and carry no weight here. The mean price target cited in the data predates 2024 by nearly three years and cannot be reliably compared to the current $52 price. Bulls are essentially arguing that a steel major at 0.46x book, with improving earnings momentum, has been oversold on macro fears. Bears are pointing to a 5-year EBIT CAGR deep in negative territory and the broader headwinds facing Korean steel — softening Chinese demand, margin pressure, and a cautious global capex environment.
The July 6 print will test whether the partial price recovery reflects a genuine reassessment of those fundamentals, or simply short covering into an event that the market still views with considerable uncertainty.
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