Back to previous section

Jefferies upgrades HSBC to ‘buy’

Jefferies upgraded HSBC on Thursday to ‘buy’ from ‘hold’ and hiked the price target to 770p from 574p as it said the bank was positively-geared to a re-opening in China.

  • HSBC Holdings
  • 05 January 2023 10:44:02
HSBC UK

Source: Sharecast

"We believe the China/HK re-opening and capital return prospects of HSBC are underappreciated attributes which create positive return/risk asymmetry and move us to buy on the name," Jefferies said.

Jefferies pointed out that 37% of loans and 36% of pre-tax profit are attributed to China & HK and said it expects a re-opened economy to drive higher loan demand and general activity, which should benefit HSBC.

"HK and mainland China have modestly higher net interest margins for the group, so a pick-up in loan growth in these regions should be accretive to the group," it said.

Jefferies also said it now estimates that the sale of the bank's Canada business can unlock $14bn of buybacks and special dividends across 2023 and 2024 and sees credible re-rating potential given estimated 13% return on tangible equity in 2024 against 0.8x TBV today.

At 0930 GMT, HSBC shares were up 2.3% at 555.80p.

FTSE 100 ( UKX )

Isin: N/A
Exchange: London Stock Exchange
Sell:
0.00
Buy:
0.00
Change: 16.85 ( 0.19 %)
Date:
Prices delayed by at least 15 minutes

Compare our accounts

If you're looking to grow your money over the longer term (5+ years), we have a range of investment choices to help.

View our accounts

Bank of Scotland is not responsible for the content and accuracy of the Markets News articles. We may not share the views of the author. Understand the risks, please remember the value of your investment can go down as well as up and you may not get back the full amount you invest. We don't provide advice so if you are in any doubt about buying and selling shares or making your own investment decisions we recommend you seek advice from a suitably qualified Financial Advisor. Past performance is not a guide to future performance.

Important legal information

Bank of Scotland Share Dealing Service is operated by Halifax Share Dealing Limited. Halifax Share Dealing Limited. Registered in England and Wales No. 3195646. Registered Office: Trinity Road, Halifax, West Yorkshire HX1 2RG. Authorised and regulated by the Financial Conduct Authority, 12 Endeavour Square, London, E20 1JN under number 183332. A Member of the London Stock Exchange and an HM Revenue & Customs Approved ISA Manager.

Logo Allfunds

The information contained within this website is provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd unless otherwise stated. The information is not intended to be advice or a recommendation to buy, sell or hold any of the shares, companies or investment vehicles mentioned, nor is it information meant to be a research recommendation. This is a solution powered by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd incorporating their prices, data news, charts, fundamentals and investor tools on this site. Terms and conditions apply. Prices and trades are provided by Allfunds Digital, S.L.U. acting through its business division Digital Look Ltd and are delayed by at least 15 minutes.

FE fundinfo Logo

Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.

Refinitiv Logo

© 2025 Refinitiv, an LSEG business. All rights reserved.