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Why It's the Best Time to Add HSBC Stock to Your Portfolio
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HSBC Holdings plc’s (HSBC - Free Report) extensive global network and strong capital position make it well positioned for future growth. Also, its successful cost-saving initiatives are expected to aid bottom-line improvement.
The company’s Zacks Consensus Estimate for the current-year earnings has moved 3.6% upward over the past 30 days, reflecting analysts’ optimism about its earnings growth potential. Thus, the stock currently carries a Zacks Rank #2 (Buy).
HSBC’s share price has increased 18.1% so far this year, outperforming the 14.9% rally for the industry it belongs to. Given the positive estimate revisions and a solid Zacks Rank, the stock should gain further.
HSBC has been relying on various streamlining actions to cut down expenses. The company is on track to divest its unprofitable/non-core operations to achieve its cost-saving target of $6 billion by the end of 2017.
HSBC remains strong with respect to its balance sheet and liquidity position. The company has been successful in lowering its risk-weighted assets (RWAs) in the past and aims to continue removing such low-return RWAs going forward.
Given a stable capital position, HSBC is expected to continue enhancing shareholder value through efficient capital deployment activities. It plans to keep dividend payout ratio of 40-60% remains intact.
However, dismal European economic growth and weak loan demand are expected to lead to muted revenue growth. Also, higher litigation costs and stringent regulations will likely keep the company’s financials under pressure.
A few other top-ranked stocks from the same space are mentioned below.
The Toronto-Dominion Bank (TD - Free Report) has witnessed an upward earnings estimate revision of 7.6% for the current fiscal year over the past 60 days. Its share price has increased 4.3% so far this year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bank of Montreal (BMO - Free Report) also carries a Zacks Rank #1. The stock has witnessed an upward earnings estimate revision of 6.4% for the current fiscal year over the past 60 days and has increased 2.5% year to date.
Banco de Chile’s (BCH - Free Report) Zacks Consensus Estimate for the current year has been revised 3.4% upward over the past 60 days. Its shares have gained 25.4% year to date. It carries a Zacks Rank #2.
One Simple Trading Idea
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
This proven stock-picking system is grounded on a single big idea that can be fortune shaping and life changing. You can apply it to your portfolio starting today.
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Why It's the Best Time to Add HSBC Stock to Your Portfolio
HSBC Holdings plc’s (HSBC - Free Report) extensive global network and strong capital position make it well positioned for future growth. Also, its successful cost-saving initiatives are expected to aid bottom-line improvement.
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The company’s Zacks Consensus Estimate for the current-year earnings has moved 3.6% upward over the past 30 days, reflecting analysts’ optimism about its earnings growth potential. Thus, the stock currently carries a Zacks Rank #2 (Buy).
HSBC’s share price has increased 18.1% so far this year, outperforming the 14.9% rally for the industry it belongs to. Given the positive estimate revisions and a solid Zacks Rank, the stock should gain further.
HSBC has been relying on various streamlining actions to cut down expenses. The company is on track to divest its unprofitable/non-core operations to achieve its cost-saving target of $6 billion by the end of 2017.
HSBC remains strong with respect to its balance sheet and liquidity position. The company has been successful in lowering its risk-weighted assets (RWAs) in the past and aims to continue removing such low-return RWAs going forward.
Given a stable capital position, HSBC is expected to continue enhancing shareholder value through efficient capital deployment activities. It plans to keep dividend payout ratio of 40-60% remains intact.
However, dismal European economic growth and weak loan demand are expected to lead to muted revenue growth. Also, higher litigation costs and stringent regulations will likely keep the company’s financials under pressure.
A few other top-ranked stocks from the same space are mentioned below.
The Toronto-Dominion Bank (TD - Free Report) has witnessed an upward earnings estimate revision of 7.6% for the current fiscal year over the past 60 days. Its share price has increased 4.3% so far this year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bank of Montreal (BMO - Free Report) also carries a Zacks Rank #1. The stock has witnessed an upward earnings estimate revision of 6.4% for the current fiscal year over the past 60 days and has increased 2.5% year to date.
Banco de Chile’s (BCH - Free Report) Zacks Consensus Estimate for the current year has been revised 3.4% upward over the past 60 days. Its shares have gained 25.4% year to date. It carries a Zacks Rank #2.
One Simple Trading Idea
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
This proven stock-picking system is grounded on a single big idea that can be fortune shaping and life changing. You can apply it to your portfolio starting today.
Learn more >>