After a strong performance by utility company Korea Electric Power Corporation (KEP), Zacks senior power industry analyst Jon Kolb reiterates his Hold rating on the American Depositary Receipts (ADRs).  The following excerpts explain his position:

'Following a 17.6% total return over the last twelve months following particularly strong performance at the turn of the 2005-06 calendar year when the Korean Won (currency unit) appreciated against the U.S. dollar -- benefiting import-intensive companies such as utilities with significant dollar-denominated debt -- we expect only modest price appreciation going forward. KEPCO is the dominant player in Korea's electricity sector, and remains well positioned to capitalize on growth opportunities in this market and benefit from the industry restructuring initiated by the Korean government.

'However, with volatile global energy prices, KEP continues to face risks of increasing costs, thereby often reporting lower operating earnings and net income. Therefore, we maintain our HOLD recommendation on KEP ADRs with a six-month target price of $25.

'New money coming into the market should benefit emerging market stocks. In fiscal 2007, we expect moderate top- and bottom-line growth. The stock currently trades at 11.7x our 2007 earnings per share estimate or in-line with its industry peers, while other valuation metrics (i.e., price-to-book, price-to-sales, and price-to-cash flow) indicate discount valuations relative to peers which we consider reasonable for an emerging market utility.'