HSBC HOLDINGS PLC-SPONS ADR (HSBC)
US4042804066 - ADR
We assign a fundamental rating of 4 out of 10 to HSBC. HSBC was compared to 412 industry peers in the Banks industry. There are concerns on the financial health of HSBC while its profitability can be described as average. HSBC is not valued too expensively and it also shows a decent growth rate. Finally HSBC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year HSBC was profitable.
HSBC had a positive operating cash flow in the past year.
HSBC had positive earnings in each of the past 5 years.
In the past 5 years HSBC always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of HSBC (1.26%) is better than 80.83% of its industry peers.
The Return On Equity of HSBC (20.71%) is better than 97.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.26% | ||
| ROE | 20.71% | ||
| ROIC | N/A |
ROA(3y)0.56%
ROA(5y)0.4%
ROE(3y)8.93%
ROE(5y)6.41%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
HSBC has a Profit Margin of 30.43%. This is in the better half of the industry: HSBC outperforms 77.43% of its industry peers.
In the last couple of years the Profit Margin of HSBC has grown nicely.
HSBC does not have Operating Margin and Gross Margin available, so we won't be analyzing them here.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | N/A | ||
| PM (TTM) | 30.43% | ||
| GM | N/A |
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y67.71%
PM growth 5Y8.86%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
HSBC does not have a ROIC to compare to the WACC, probably because it is not profitable.
The number of shares outstanding for HSBC has been reduced compared to 1 year ago.
HSBC has less shares outstanding than it did 5 years ago.
HSBC has a worse debt/assets ratio than last year.
2.2 Solvency
HSBC has a debt to FCF ratio of 9.40. This is a negative value and a sign of low solvency as HSBC would need 9.40 years to pay back of all of its debts.
With a Debt to FCF ratio value of 9.40, HSBC is not doing good in the industry: 77.18% of the companies in the same industry are doing better.
HSBC has a Debt/Equity ratio of 1.80. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.80, HSBC is doing worse than 90.05% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.8 | ||
| Debt/FCF | 9.4 | ||
| Altman-Z | N/A |
ROIC/WACCN/A
WACC5.85%
2.3 Liquidity
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | N/A | ||
| Quick Ratio | N/A |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 35.65% over the past year.
Measured over the past years, HSBC shows a quite strong growth in Earnings Per Share. The EPS has been growing by 12.68% on average per year.
The Revenue has grown by 25.55% in the past year. This is a very strong growth!
Measured over the past years, HSBC shows a small growth in Revenue. The Revenue has been growing by 3.08% on average per year.
EPS 1Y (TTM)35.65%
EPS 3Y81.95%
EPS 5Y12.68%
EPS growth Q2Q-11.11%
Revenue 1Y (TTM)25.55%
Revenue growth 3Y6.85%
Revenue growth 5Y3.08%
Revenue growth Q2Q4.07%
3.2 Future
HSBC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 0.53% yearly.
Based on estimates for the next years, HSBC will show a small growth in Revenue. The Revenue will grow by 1.14% on average per year.
EPS Next Y2.94%
EPS Next 2Y0.42%
EPS Next 3Y0.84%
EPS Next 5Y0.53%
Revenue Next Year-0.99%
Revenue Next 2Y-1.67%
Revenue Next 3Y-0.97%
Revenue Next 5Y1.14%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 7.15, the valuation of HSBC can be described as very cheap.
Compared to the rest of the industry, the Price/Earnings ratio of HSBC indicates a rather cheap valuation: HSBC is cheaper than 87.38% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of HSBC to the average of the S&P500 Index (27.73), we can say HSBC is valued rather cheaply.
HSBC is valuated cheaply with a Price/Forward Earnings ratio of 6.94.
Based on the Price/Forward Earnings ratio, HSBC is valued cheaper than 90.29% of the companies in the same industry.
HSBC is valuated cheaply when we compare the Price/Forward Earnings ratio to 20.41, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.15 | ||
| Fwd PE | 6.94 |
4.2 Price Multiples
HSBC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. HSBC is cheaper than 88.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 4.73 | ||
| EV/EBITDA | N/A |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates HSBC does not grow enough to justify the current Price/Earnings ratio.
PEG (NY)2.43
PEG (5Y)0.56
EPS Next 2Y0.42%
EPS Next 3Y0.84%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.53%, HSBC is a good candidate for dividend investing.
HSBC's Dividend Yield is rather good when compared to the industry average which is at 3.76. HSBC pays more dividend than 88.35% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, HSBC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.53% |
5.2 History
The dividend of HSBC has a limited annual growth rate of 2.95%.
HSBC has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of HSBC decreased in the last 3 years.
Dividend Growth(5Y)2.95%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
HSBC pays out 31.78% of its income as dividend. This is a sustainable payout ratio.
The dividend of HSBC is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP31.78%
EPS Next 2Y0.42%
EPS Next 3Y0.84%
HSBC HOLDINGS PLC-SPONS ADR
NYSE:HSBC (5/3/2024, 7:04:00 PM)
After market: 44.45 0 (0%)44.45
-0.06 (-0.13%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupBanks
GICS IndustryBanks
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap167.39B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.53% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
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EPS beat(8)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 7.15 | ||
| Fwd PE | 6.94 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.43
PEG (5Y)0.56
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.26% | ||
| ROE | 20.71% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | N/A | ||
| PM (TTM) | 30.43% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.04
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.8 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | N/A | ||
| Quick Ratio | N/A | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)35.65%
EPS 3Y81.95%
EPS 5Y
EPS growth Q2Q
EPS Next Y2.94%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)25.55%
Revenue growth 3Y6.85%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y