EPOL Still Has Value After 2023 Dominance

seekingalpha03-25

The iShares MSCI Poland ETF had an exceptional 2023 despite inflationary headwinds and slower GDP growth.Poland itself is forecasted to see modest growth in the near term, and a recent election has ...

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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nEPOL Still Has Value After 2023 Dominance\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-03-25 19:46 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4680227-epol-has-value-after-2023-dominance><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The iShares MSCI Poland ETF had an exceptional 2023 despite inflationary headwinds and slower GDP growth.Poland itself is forecasted to see modest growth in the near term, and a recent election has ...</p>\n\n<a href=\"https://seekingalpha.com/article/4680227-epol-has-value-after-2023-dominance\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4550","symbol_name":"红杉资本持仓","start_time":0,"source_url":"https://seekingalpha.com/article/4680227-epol-has-value-after-2023-dominance","article_id":"2422513785","we_media_id":null,"thumbnails":["https://static.seekingalpha.com/cdn/s3/uploads/getty_images/1469818851/image_1469818851.jpg"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2422513785","pubTimestamp":1711367173,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"The iShares MSCI Poland ETF had an exceptional 2023 despite inflationary headwinds and slower GDP growth.Poland itself is forecasted to see modest growth in the near term, and a recent election has pr","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4550":"红杉资本持仓","EDEN.AU":"EDEN INNOVATIONS-NEW SHARES","FDN":"First Trust Dow Jones Internet I","PSKOF":"ORLEN SA","ENOR":"iShares MSCI Norway ETF","BK4138":"石油与天然气的炼制和营销","PSZKY":"Powszechna Kasa Oszczednosci Bank Polski SA","EPOL":"iShares MSCI Poland ETF","EDEN":"iShares MSCI Denmark ETF","BK4207":"综合性银行","EWO":"奥地利ETF-iShares MSCI","EWD":"瑞典ETF-iShares MSCI"},"translate_title":"EPOL在2023年占据主导地位后仍有价值","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"EDEN":1,"EDEN.AU":1,"ENOR":1,"EPOL":1,"EWD":1,"EWO":1,"PSKOF":1,"PSZKY":1,"FDN":0.9},"content_text":"The iShares MSCI Poland ETF had an exceptional 2023 despite inflationary headwinds and slower GDP growth.Poland itself is forecasted to see modest growth in the near term, and a recent election has proven to be encouraging on a few different fronts.The case for EPOL is also undergirded by its value profile, which is still cheap despite recent success.   Kateryna KolesnykThe iShares MSCI Poland ETF (NYSEARCA:EPOL) was among a handful of country ETFs that performed better than the S&P 500 in 2023. Macroeconomic data has been on the uptrend, and markets rallied, particularly in Q3 following a favorable election outcome. I like EPOL's niche value in the Eastern European market, and its supporting financials are encouraging. I think EPOL has more room to run, and it's currently trading at 7.6x earnings, increasing its technical attractiveness. I rate EPOL as a buy. Middling macro After a paltry 0.4% growth in 2023, Poland's economy is projected to grow 2.6% in 2024 and extend to 2.9% in 2025 according to the OECD. The same report indicates that inflation saw a sharp decline in 2023, though it is projected to stay elevated through 2025 at a projected level of 3.4%. The central bank slashed interest rates twice in 2023, in response to headline inflation that loomed near 18%. The rate cuts came back-to-back in early September and then again in October ahead of elections. The central bank indicated it would maintain rates at the current 5.75% for the duration of 2024, until inflation further moderated.   OECDEPOL fund specifics The iShares MSCI Poland ETF (EPOL) tracks the MSCI Poland IMI 25/50 Index and is around $296M in assets as of writing. EPOL's flows have been a whipsaw over the last 5 years. After strong net inflows in 2019 and 2020, EPOL saw a flight from the fund in 2021 and 2022. EPOL has been regaining traction in the years following, with net inflows of ~$17M YTD. ETF.COMHoldings This fund is concentrated from a sector perspective. About half of the assets are in the Financials sector. The breakdown is more evenly spread among energy, consumer cyclicals, as well as basic materials. This overweight is no surprise, given that the Polish Banking sector is second only to Germany in terms of number of banks.  Seeking AlphaPKO Bank Polski (OTCPK:PSZKY) accounts for around 15 of the fund's total assets. There is an additional large allocation (~11%) to energy conglomerate Orlen S.A. (OTCPK:PSKOF). The top 10 holdings account for 68% of the fund's total holdings. I'll emphasize that I don't see this level of concentration as a deficiency given that I view single country ETFs as high conviction plays. This number of holdings is appropriate for a country ETF like EPOL. Seeking AlphaValuation I want to highlight some points around EPOL's value. It is currently trading at 10.1x in terms of earnings, while its book value is currently 1.1x. For comparison, when we look at other peer countries in the neighborhood, we see that EPOL is trading at a discount relative to the majority of its cohort.             iShares MSCI Poland ETF (EPOL) iShares MSCI Sweden ETF (EWD) iShares MSCI Denmark ETF (EDEN) iShares MSCI Norway ETF (ENOR) iShares MSCI Austria ETF (EWO)   P/B 1.12 2.42 2.83 1.63 0.96   P/E 7.6 15.39 19.68 10.08 7.97   Click to enlarge The fund's trailing 12 month yield is currently 2.78%. The most recent distribution in January of 2024 saw a large increase in yield, elevating the fund's dividend growth profile. Seeking AlphaPositive election result pushes EPOL higher EPOL delivered an impressive performance on 2023, both an impressive standalone performance, as well as relative to several of its regional counterparts, as well as the broad MSCI Europe Index in 2023. Performance dipped in October, but then rallied stronger for +58% price return by year-end. The exuberance in the market was catalyzed by a positive election result, that gave the opposition party a parliamentary majority, leading to new PM Donald Tusk. Data by YChartsThe election result was also a boon for the local currency, the Polish Zloty, which had plummeted in value against the Euro in the run up to the election. The Zloty climbed to new highs in 2023 following the October outcome. Google FinanceEPOL tests tolerance for volatility Looking at EPOL's rolling 30 day volatility since inception, we see that it remains elevated relative to some of its counterparts, as well as the broad European regional index. Given this fund's exposure to cyclical sectors such energy and financials, heightened volatility is baked into EPOL's composition. Data by YChartsSimilarly, we see that EPOL has demonstrated a higher max drawdown over the 5-year period relative to Europe and other single country peers. However, peers rank close to similar levels. Data by YCharts Exuberance is transitory, but the value is there  EPOL is in a good position to continue to benefit from soft growth in the region. There are risks endemic to the fund described above. It carries heightened volatility and has tended to provide less downside protection than its peers in the region. That said, what I find encouraging is that EPOL is still offering decent value after printing huge returns in 2023. With interest rates likely to remain elevated through 2024, enthusiasm might be more muted comparatively in the coming year. However, I am still seeing a green light for EPOL at this time.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2422513785"}