HSBC 02 (0005) (Jun 10 - Dec 24)

Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Fri Sep 23, 2016 7:57 pm

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HSBC is seeking to release billions of dollars of capital tied up in the United States without upsetting the country's politicians and regulators.

The British bank, which has been in the sights of U.S. regulators over breaching rules over money laundering, has more than $20 billion of capital in the United States earning a slim 1 percent return.

The bank's investors are currently missing out on higher profits and more secure dividends as a result of this hefty U.S. balance sheet.

Source: Reuters

http://www.reuters.com/article/us-hsbc- ... News%20Now
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Thu Oct 06, 2016 11:24 am

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<Research Report>M Stanley: HSBC HOLDINGS Revenue Remains Key Challenge; Kept Underweight

Morgan Stanley, in its report, said the share price of HSBC HOLDINGS (00005.HK) has rebounded about 30% (based on USD exchange rate) from the low level since EU referendum, far above the valuation of Asian banks.

The research house opined that the profit of HSBC will continue to be revised down given weakening revenue and that the sustainability of dividend distribution becomes sceptical in long run. Hence, target price was $45 with rating kept Underweight.

The research house said it was cautious about HSBC's revenue because of the decline in interest rates, weak lending growth in Hong Kong and the UK, and uncertainty in the global commercial management business outlook.

The research house highlighted that there is a challenge to achieve a return on assets (ROA) of 0.5% or more if the interest margin does not expand or cost reduction is not enough.

The research house expected the bank's dividend per share in 2016 to 2018 to be $0.51 and expected return on equity (ROE) in 2016 to 2018 to be 6.8%, 6.5% and 6.9%.

Source: AAStocks Financial News
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Mon Nov 07, 2016 2:02 pm

HSBC Jumps On Stronger Q3 Capital Buffer

By Shuli Ren

HSBC (5.Hong Kong/HSBC) soared 2.3% in afternoon trading after reporting better-than-expected third quarter earnings.

In the third-quarter, revenue at HSBC rose 2% to $12.8 billion, while adjusted pretax profit, which excludes one-time items, rose 7% to $5.6 billion, slightly ahead of consensus estimate of $5.3 billion.

The big beat is a stronger capital ratio. Morgan Stanley’s Anil Agarwal writes:

The bank reported CET1 of 13.9% compared to 12.1% last quarter. There was a net 50 bps positive impact from Brazil disposal (adjusting for the buyback impact). However, the big swing has come from change in treatment of Bocom.

Till now, at the group level, the bank used to follow proportional consolidation of RWAs. However, now it has moved to a deduction from capital (following a clarification from PRA).

This caused reported RWA’s at the group level [b]to reduce by US$ 121 bn [/b]and there was a threshold deduction from capital of US$ 5.6 bn. The net impact was a 104 bps increase in CET1 for HSBC.

HSBC’s altered treatment of China’s Bank of Communications stake[b] freed up $5.6 billion of its capital, [/b]thereby boosting its tier-1 capital ratio.

A strong capital buffer at HSBC is important, not just because of the conventional credit risk reasons. Investors are attracted to HSBC’s handsome 7.3% dividend yield. A stronger capital ratio means HSBC is less likely to cut dividends.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... al-buffer/
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Mon Nov 07, 2016 2:19 pm

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HSBC HOLDINGS Share Price Surges Over 2% as 3Q Result Above Estimates

At noon, HSBC HOLDINGS (00005.HK) announced that for the third quarter alone, adjusted PBT rose 7% yearly to US$5.591 billion, better than market expectation.

That spiked the share price, which last printed at $58.9, up 2.5%, on volume of 14.72 million shares.

Stuart Gulliver, Chief Executive of HSBC HOLDINGS, said the group had completed 59% of the US$2.5 billion equity buy-back as at 31 October. HSBC expected to finish the programme by the end of 2016 or early in the first quarter of 2017, depending on market trading volumes in the fourth quarter.

Also, following a change in the regulatory treatment of the group's investment in BANKCOMM (03328.HK), the CET-1 capital ratio increased to 13.9%. This is another action forming part of the group's ongoing capital management of the group that reinforces its ability to support the dividend, to invest in the business and, over the medium term, to contemplate share buy-backs, as appropriate.

Source: AAStocks Financial News
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Tue Nov 08, 2016 7:32 am

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HSBC Holdings (0005) posted an 86 percent fall in pretax profit to US$560 million for the third quarter ending September as it booked a substantial loss on the sale of its Brazilian unit.

But, its core capital ratio jumped to 13.9 percent due to the change in the regulatory treatment of its investment in Bank of Communications (3328).

HSBC shares rebounded 2.9 percent to HK$59.15. Bank of America Merrill Lynch has a buy rating on the stock but target price is just HK$60.8.

Perhaps, they trying to say there is limited upside at the current level. Lets maintain a cautiously optimistic view on Hong Kong stocks.

Source; Dr Check, The Standard
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Tue Dec 06, 2016 11:04 am

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Time To Buy HSBC, Says Morgan Stanley


By Shuli Ren

HSBC (5.Hong Kong/HSBC) gained 1.5% in Hong Kong amid heavy buying after long-time bear Morgan Stanley double upgraded this stock from Underweight to Overweight.

Morgan Stanley has been a long-time bear because it is worried HSBC can’t maintain its generous dividend payouts amid sluggish revenue growth. HSBC pays a handsome 5.9% dividend yield.

HSBC has a large operation in Hong Kong, whose currency is pegged to the US dollar. Since Donald Trump‘s presidential win, the US government bond yields have been rising, pushing Hong Kong’s interest rates up as well. Steeper yield curves mean banks can make money now!

HSBC has also been cautious with giving out loans, preferring to clean out its balance sheet to top-line growth. Its loan-to-deposit ratio stood at just 69% in the September quarter. However, Asian economies’ growth is picking up again and HSBC is poised to grow its consumer loan book. (See chart)

Analyst Anil Agarwal wrote:
The bank had been focussed on derisking various parts of balance sheet. As a result, underlying growth in RWAs was muted – 6% in the period end 2015 to September 2016. However, this may start changing in 2017 as the bank starts taking some more risk, especially in consumer lending in HK / rest of Asia.

Stock has lagged peers in HK materially over the last few years. Given rate leverage and loan growth pickup, we upgrade to Overweight. MSCI HK banks generated total returns of 82% and 17% from 2011-2016 and 2016 respectively (for HSBC this was 35% and 7%).

We increase 2017/18e EPS by 10-13% in US$ primarily due to a better revenue outlook. We increase our price target by 21% reflecting earnings upgrades and lower steady state capital requirements post G-SIFI buffer reduction.

Morgan Stanley’s 64 Hong Kong dollars price target implies 12 times the bank’s 2018 earnings estimate. HSBC was trading at HK$62.20 this morning, implying little upside.

Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... n-stanley/
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Re: HSBC 02 (0005) (Jun 10 - Dec 16)

Postby winston » Tue Feb 21, 2017 3:52 pm

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HSBC Slips After Q4 Earnings: What Surprised The Market?

By Shuli Ren

Goldman Sachs writes:

HSBC 4Q16 underlying profit before tax of US$2,619 was 19%/26% below GSe/company compiled consensus, owing to negative revenue movements on long term debt and associated swaps of US$742mn.

This pertains to hedge accounting on long term debt issued by HSBC which is marked at fair value and has swaps in place to hedge interest rate or currency movements.


To offset the weakness in its revenue, HSBC has raised its cost savings target to around $6 billion, versus $4.5-5 billion previously.

HSBC said it would buy back another $1 billion shares, to be completed in the first half of this year. But analysts from UBS to Citi Research had expected $3 billion buyback for the entire 2017.


Source: Barron's Asia

http://blogs.barrons.com/asiastocks/201 ... 16-profit/
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Re: HSBC 02 (0005) (Jun 10 - Dec 18)

Postby behappyalways » Tue Feb 21, 2017 5:44 pm

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Re: HSBC 02 (0005) (Jun 10 - Dec 18)

Postby winston » Wed Feb 22, 2017 8:17 am

Index takes buffeting on HSBC's poor results

The bank's share price fell 5 percent in Hong Kong to HK$65.55 after London-based HSBC reported a 62-percent slump in annual pre-tax profit.

It fell to US$7.1 billion (HK$55.2 billion) compared to US$18.8 billion last year. That was about half of what analysts expected.

The bank had a US$3.2-billion write-down from its restructuring, and it is having to rebuild its Swiss operations after compliance failures.

It will meantime try to keep its 6-percent dividend yield.

HSBC holds 62.14 percent of Hang Seng Bank (011). The leading retail bank in Hong Kong saw 2016's net profit tumble 40 percent. But the figure was not too bad as it only fell 4 percent excluding disposal of Industrial Bank in 2015.

Morgan Stanley said a strong capital position can allow it to increase its dividend payout, giving it an overweight rating and a target price of HK$175.

It closed at HK$163.30 with a 5.3 percent dividend yield. Keep accumulating it on the dip.

Source: Dr Check, The Standard
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Re: HSBC 02 (0005) (Jun 10 - Dec 18)

Postby winston » Wed Feb 22, 2017 12:59 pm

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Canary In A Contained Coalmine? HSBC Crashes Most Since Crisis On ‘Surprise’ Revenue Plunge

By Tyler Durden

It faces more than $3 billion of revenue headwinds in 2017, including currency movements and record-low interest rates in the U.K. Executives also warned U.S. President Donald Trump’s protectionist stance and Brexit could damage their business.


The items included a $2.4 billion writedown of the value of its European private bank and a $1.6 billion adjustment in the bank’s own credit spreads.


Source: TTR

http://www.thetradingreport.com/2017/02 ... ue-plunge/
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