Validea Joseph Piotroski Strategy Daily Upgrade Report - 10/30/2024
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 30 2024
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Source: NASDAQ.COM
HSBC Holdings PLC Rating Update: HSBC's rating based on Joseph Piotroski's value-quant strategy has improved significantly from 0% to 80%, indicating strong interest in the stock due to its solid fundamentals and valuation.
About Joseph Piotroski and Validea: Joseph Piotroski, an accounting professor, developed a successful stock-selection method that outperformed the S&P 500, and Validea utilizes strategies from various investment legends for stock analysis and model portfolios.
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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.
HSBC Becomes First European Bank to Surpass $300 Billion Market Cap
- Stock Price Surge: HSBC shares rose by 3.3% to £12.83 in London trading, elevating its market cap to £220 billion (approximately $302 billion), making it the first European-listed bank to surpass the $300 billion mark, reflecting strong market confidence in its future performance.
- Analyst Target Upgrade: Citi analyst Andrew Coombs raised HSBC's price target from £13.20 to £13.70 and placed a 90-day positive catalyst watch on the bank, anticipating a Q4 underlying profit before tax of $8.5 billion, which is 6% above the Visible Alpha consensus, indicating improved profitability.
- Revenue Synergy Potential: Coombs noted that the potential for revenue synergy is expected to improve following HSBC's acquisition of minority stakes in Hang Seng Bank, which closed in January, highlighting the company's strategic direction in resource integration and operational efficiency enhancement.
- Cost Optimization Outlook: Following recent restructuring and ongoing strategic reviews of its operations in Australia, Indonesia, and Sri Lanka, Coombs anticipates HSBC will convey a more positive message regarding cost management, further strengthening its competitive position in the market.
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Coinbase Withdraws Support for Crypto Legislation, But Analysts See Hope
- Withdrawal of Support: Coinbase Global Inc. has pulled back its support for a major U.S. crypto market structure bill, with CEO Brian Armstrong stating that 'no bill is better than a bad bill', yet HSBC analysts believe the legislation still has potential.
- Need for Legislative Clarity: HSBC argues that legislative clarity is essential to unlock significant institutional adoption from hedge funds and corporations, emphasizing that the bill aims to clearly delineate the roles of the SEC and the Commodity Futures Trading Commission (CFTC).
- Political Window Warning: Bitwise CIO Matt Hougan warns that the current pro-crypto environment represents a 'political window' that will not remain open indefinitely, indicating that the lack of a codified market structure leaves the industry vulnerable to shifts in political sentiment.
- Momentum for Future Action: Despite Coinbase's withdrawal raising concerns, strong support from Fairshake PAC and leadership from Ripple continues, with analysts expecting incremental wins through the Agriculture Committee's bill that expands CFTC oversight.
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