HSBC (NYSE: HSBC) is one of 313 publicly-traded companies in the “Banks” industry, but how does it weigh in compared to its peers? We will compare HSBC to related companies based on the strength of its analyst recommendations, profitability, valuation, institutional ownership, earnings, risk and dividends.

Earnings and Valuation

This table compares HSBC and its peers revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
HSBC $50.32 billion $2.48 billion 35.86
HSBC Competitors $5.50 billion $827.87 million 378.21

HSBC has higher revenue and earnings than its peers. HSBC is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Risk & Volatility

HSBC has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, HSBC’s peers have a beta of 0.79, meaning that their average share price is 21% less volatile than the S&P 500.

Profitability

This table compares HSBC and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
HSBC 1.42% 4.13% 0.32%
HSBC Competitors 18.68% 8.35% 0.94%

Analyst Recommendations

This is a summary of current recommendations and price targets for HSBC and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
HSBC 1 4 4 0 2.33
HSBC Competitors 2161 8451 8553 332 2.36

HSBC currently has a consensus price target of $9.00, indicating a potential downside of 82.07%. As a group, “Banks” companies have a potential downside of 5.44%. Given HSBC’s peers stronger consensus rating and higher possible upside, analysts plainly believe HSBC has less favorable growth aspects than its peers.

Insider and Institutional Ownership

2.3% of HSBC shares are held by institutional investors. Comparatively, 52.2% of shares of all “Banks” companies are held by institutional investors. 10.4% of shares of all “Banks” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Dividends

HSBC pays an annual dividend of $2.00 per share and has a dividend yield of 4.0%. HSBC pays out 142.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Banks” companies pay a dividend yield of 2.0% and pay out 35.2% of their earnings in the form of a dividend. HSBC has increased its dividend for 3 consecutive years.

Summary

HSBC peers beat HSBC on 10 of the 15 factors compared.

About HSBC

HSBC Holdings plc (HSBC) is the banking and financial services company. The Company manages its products and services through four businesses: Retail Banking and Wealth Management (RBWM), Commercial Banking (CMB), Global Banking and Markets (GB&M), and Global Private Banking (GPB). It operates across various geographical regions, which include Europe, Asia, Middle East and North Africa, North America and Latin America. RBWM business offers Retail Banking, Wealth Management, Asset Management and Insurance. CMB services include working capital, term loans, payment services and international trade facilitation, among other services, as well as expertise in mergers and acquisitions, and access to financial markets. GB&M supports government, corporate and institutional clients across the world. GPB’s products and services include Investment Management, Private Wealth Solutions, and a range of Private Banking services.

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