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<Research>UBS: HSBC HOLDINGS (00005.HK) Reported PBT Beats w/ Strong Handling Fee Income (Correction)
Recommend 26 Positive 46 Negative 25 |
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HSBC HOLDINGS (00005.HK) announced its 1H25 results for the six months ended June 2025. Reported profit before tax amounted to US$15.81 billion, down 26.7% YoY, in line with the forecasts of the three brokers ranging from US$15.477 billion to US$16.073 billion as summarized by our reporters. HSBC HOLDINGS wrote down its stake in BANKCOMM (03328.HK) (601328.SH) by US$2.1 billion, exceeding the UBS' estimation of US$1.6 billion, and its restructuring budget (US$652 million vs. US$400 million) was also ahead the broker's prediction, UBS released a research report saying. UBS deemed both as value neutral. HSBC HOLDINGS' 2Q25 reported profit before tax (PBT) excluding notable items amounted to US$9.162 billion, 10% higher than the Company's expectation, the broker added. Income was 5% higher, while net interest income (NII) from banking was 2% better. Fee and other income was 11% higher, while operating expenses were in line with expectations, with profit before provisions increasing by 10%. UBS estimated that HSBC HOLDINGS' current valuation will be equivalent to a FY2026 projected PE ratio of 9.5x, compared to STANCHART (02888.HK)'s 8.8x, with a dividend yield of 5% and a net tangible assets (NTA) of 1.4x, corresponding to a FY2026 projected ROTE of 14.6%. Based on the above reasons, the broker rated London-listed HSBC Holdings plc (HSBA.L) at Neutral, with a target price of GBX935. AAStocks Financial News Website: www.aastocks.com |
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