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<Research>JPM Forecasts Normalized ROTE Expansion for HSBC and Stanchart Over Next 2 Yrs, Raises TPs
Recommend 15 Positive 20 Negative 11 |
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HSBC HOLDINGS (00005.HK) and STANCHART (02888.HK) have seen their stock prices advanced by 29% and 26% respectively over the past three months, outperforming the HSI by approximately 26 and 23 ppts during the same period, JPMorgan said in its research report. JPMorgan forecast that this outperformance trend will continue, on the back of book value compounding, dividends, and share buybacks, with annual returns of 12% for HSBC and 15% for Standard Chartered. JPMorgan believed that a stable interest rate outlook has reinforced investor confidence in the ROTE sustainability of both banks. It predicted that the normalized ROTE for HSBC and Standard Chartered will expand by 48 and 32 bps respectively from 2025 to 2027. Moreover, the broker expected both banks to have further potential for re-rating, with the upcoming 4Q25 results serving as a short-term catalyst for HSBC and Standard Chartered. JPMorgan raised the target price for HSBC from HKD138 to HKD165 and for Standard Chartered from HKD190 to HKD265, reiterating an Overweight rating for both. Due to higher potential growth and re-rating potential, it preferred Standard Chartered. AASTOCKS Financial News Website: www.aastocks.com |
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