Company Targets RoTE of 17% for 2026-2028
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 25 2026
0mins
Should l Buy HSBC?
The company said, "We are targeting a RoTE of 17% or better for 2026, 2027 and 2028, excluding notable items. Our revised target reflects momentum in our earnings and the positive progress we are making in our strategic execution. We are targeting year-on-year growth in revenue from 2026 to 2028, rising to 5% growth in 2028 compared with 2027 excluding notable items and on a constant currency basis. We maintain our dividend payout ratio target basis of 50% in 2026, 2027 and 2028. Our target basis payout ratio is calculated as a percentage of earnings per share excluding material notable items and related impacts."
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Analyst Views on HSBC
About HSBC
HSBC Holdings plc (HSBC) is a banking and financial services company. Its business segments include Hong Kong, UK, Corporate and Institutional Banking (CIB), and International Wealth and Premier Banking (IWPB). Its Hong Kong business comprises retail banking and wealth and commercial banking of HSBC Hong Kong and Hang Seng Bank. Its UK business comprises UK retail banking and wealth (including first direct and M&S Bank) and UK commercial banking, including HSBC Innovation Bank. The CIB segment is formed from the integration of its commercial banking business (outside the UK and Hong Kong) with its global banking and markets business. The IWPB segment comprises premier banking outside of Hong Kong and the UK, its global private bank, and its asset management, insurance and investment distribution businesses. Its customers worldwide through a network covering 58 countries and territories. Its customers range from individual savers and investors to companies, governments and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Top-Rated Companies: Among large-cap financial firms with market capitalizations above $10 billion, BNP Paribas SA leads with a quant rating of 4.92, classified as a Strong Buy, while HSBC Holdings plc follows closely with a rating of 4.91, indicating robust financial health and market confidence.
- Bottom-Rated Companies: Conversely, Ryan Specialty Holdings has a low quant rating of 1.29, categorized as a Strong Sell, highlighting significant weaknesses in profitability and market expectations, which could exert downward pressure on its stock price.
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- Significant Stock Decline: Last week, HSBC's stock fell by 9.78% to $84.05, marking the largest loss among megacap stocks, reflecting the significant impact of the Middle East conflict on market uncertainty.
- Underperformance of Banking Sector: The banking sector has largely underperformed due to the geopolitical tensions, highlighting investor concerns regarding the economic outlook and potentially leading to broader market volatility.
- Future Outlook: Despite the challenges, Elhedery emphasized that HSBC's conviction in the fundamentals of the GCC remains unchanged, suggesting the bank will continue to focus on long-term growth opportunities in the region.
See More
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Energy Vulnerability: Europe is particularly vulnerable to energy supply disruptions due to its reliance on oil from conflict zones, with the potential for further crises exacerbated by existing supply issues from the war in Ukraine.
Interest Rate Expectations: European investors are anticipating that central banks may pause interest rate cuts due to rising inflation expectations driven by soaring oil prices, which could impact economic stability.
Investment Opportunities: Despite the downturn in European equities, analysts suggest that this could present a buying opportunity for high-quality companies, especially those less affected by geopolitical issues, as market rotation trends continue.
See More
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- Financial Sector Underperformance: The financial sector extended losses for a second consecutive week, with the State Street Financial Select SPDR ETF (XLF) down 1.67% to $50.57, reflecting growing worries about credit quality and consumer confidence.
- HSBC Stock Plummets: HSBC Holdings (HSBC) recorded a significant 9.78% decline to $84.05 this week, marking it as the worst performer among large-cap stocks, indicating market apprehension regarding its future profitability.
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