London headquartered HSBC, Europe’s largest bank, recently published its full-year report revealing several forecast misses primarily due to a challenging fourth quarter.
The bank’s pre-tax profit for 2018 stood at $19.89 billion, 15.9% higher than the previous year, versus a forecast of a 23.8% jump to $21.26 billion. Reported revenue was 4.5% higher than 2017 to $53.78 billion versus a forecast of 6.28% higher to $54.674 billion.
Other financial metrics include: Net interest margin, a measure of lending profitability, stood at 1.66% as of December 31, 2018 – higher than the 1.63% seen in 2017; earnings per share for 2018 was $0.63 compared to $0.48 in 2017; and common equity tier 1 ratio — a proportion of the bank's core capital to assets — as on December 31 2018 stood at 14 % compared to 14.5% at end-2017. The bank’s Hong Kong listed shares also fell by 2% on Tuesday. It also missed its positive revenue ‘jaws’ target for 2018 recorded at minus 1.2%.
Despite these results, the bank’s CFO is satisfied, as the last quarter was particularly challenging which led to trading revenue losses in many banking groups. He is optimistic for 2019 as the bank is well-prepared for any outcome related to Brexit, and is yet to experience any dramatic slowdown in its business in China as a result of trade disputes between Washington and Beijing. However, wealth management strategists consider exactly these factors to become headwinds for the bank ahead in the market.
HSBC saw its Momentum Indicator move above the 0 level on April 18, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 81 similar instances where the indicator turned positive. In of the 81 cases, the stock moved higher in the following days. The odds of a move higher are at .
The Stochastic Oscillator demonstrated that the ticker has stayed in the oversold zone for 1 day, which means it's wise to expect a price bounce in the near future.
HSBC moved above its 50-day moving average on March 15, 2024 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for HSBC crossed bullishly above the 50-day moving average on March 15, 2024. This indicates that the trend has shifted higher and could be considered a buy signal. In of 17 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where HSBC advanced for three days, in of 303 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 271 cases where HSBC Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
The 10-day RSI Indicator for HSBC moved out of overbought territory on April 11, 2024. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 37 similar instances where the indicator moved out of overbought territory. In of the 37 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Moving Average Convergence Divergence Histogram (MACD) for HSBC turned negative on April 16, 2024. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 37 similar instances when the indicator turned negative. In of the 37 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where HSBC declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
HSBC broke above its upper Bollinger Band on April 10, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.804) is normal, around the industry mean (0.945). P/E Ratio (6.896) is within average values for comparable stocks, (8.857). Projected Growth (PEG Ratio) (0.601) is also within normal values, averaging (2.584). Dividend Yield (0.078) settles around the average of (0.100) among similar stocks. P/S Ratio (2.445) is also within normal values, averaging (2.430).
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating steady price growth. HSBC’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 59, placing this stock slightly better than average.
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
a major bank
Industry MajorBanks