HSBC Holdings plc
HSBC Holdings plc engages in the provision of banking and financial products and services worldwide. It operates through four segments: Hong Kong, UK, Corporate and Institutional Banking, and International Wealth and Premier Banking. The Hong Kong segment is involved in the retail banking and wealt…
HSBC Holdings plc engages in the provision of banking and financial products and services worldwide. It operates through four segments: Hong Kong, UK, Corporate and Institutional Banking, and International Wealth and Premier Banking. The Hong Kong segment is involved in the retail banking and wealth and commercial banking of HSBC Hong Kong and Hang Seng Bank. The UK segment engages in UK retail banking and wealth, as well as first direct and M&S Bank, UK Commercial Banking, and HSBC Innovation Bank. The Corporate and Institutional Banking segment is involved in transaction banking and capital markets. The International Wealth and Premier Banking segment is involved in the business comprising premier banking outside of Hong Kong and the UK, its private bank, asset management, and insurance businesses. The company was founded in 1865 and is headquartered in London, the United Kingdom.Looks undervalued
Why: Banks and insurers earn their money on their balance sheet, so value follows book value and how much the company earns on it (return on equity).
Details and the full model are below.
Market price below modeled range
Showing the FCFF (steady state) you selected on the company card, using 3% growth, 2.4% terminal growth and 9.6% discount. The range varies these assumptions slightly; it is illustrative, not investment advice.
Assumptions: growth 3% (limited from 8.09% because the latest annual revenue declined), discount rate 9.60%, terminal growth 2.40%. See a worked example.
Blended growth assumption: 8.1% (sector default 5.4%, own revenue history 16.1%, analyst revenue consensus 5.5%).
5-year outlook: relative outlook of about 9.7% a year (High confidence), anchored to a 7% market return and adjusted for how this company ranks against others. A ranking aid, not a prediction. See the full forecast.
Analyst consensus expects revenue growth of 5.5% a year; the growth assumption used is 3.0%.
Adjust assumptions
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Why this model: Banks and insurers earn their money on their balance sheet, so value follows book value and how much the company earns on it (return on equity).
Compare models- Recommended: Justified P/B (ROE) — GBP 10.67 (-17.8%)
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EPS-based Gordon proxy
— GBP 13.51 (+4.1%)
Not used: Treats all earnings as if paid out and ignores the cash kept for reinvestment, so it overstates value for companies that retain most profit.
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DCF (trailing free cash flow)
— GBP 20.31 (+56.4%)
Not used: Cash-flow models do not suit banks and insurers, whose cash flow is mostly funding and deposits.
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FCFF (steady state)
— GBP 19.91 (+53.4%)
Not used: Cash-flow models do not suit banks and insurers, whose cash flow is mostly funding and deposits.
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EV/EBITDA (12x)
— GBP 22.50 (+73.4%)
Not used: Used only when free cash flow is far below earnings even after averaging three years; a fixed 12x multiple also ignores sector differences.
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Fade DCF (10-year growth fade)
— GBP 20.29 (+56.3%)
Not used: Cash-flow models do not suit banks and insurers, whose cash flow is mostly funding and deposits.
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EV/Sales (Rule of 40)
— GBP 37.81 (+191.3%)
Not used: Used only for technology and communication companies whose cash-flow value is far below the price.
| Bear GBP 16.48 | 21.3% |
| Base GBP 19.91 | 34.8% |
| Bull GBP 25.97 | 50.0% |
Margin = (value − price) / value, so it is measured against the value and reads lower than the upside to value, which is measured against the price. Positive means the price is below that case.
Track record: see the methodology page for how this model has performed historically, including its limits. Treat it as a screen, not a forecast.
Price history and fair value
No chartable saved daily price history is available for this range. The chart uses stored EODHD prices only and will appear after history is saved.
More detail: quality, peers, price history, dividends and financials
Quality score: 100 / 100
Five equal checks on reported history: profitability, cash generation, revenue growth, balance sheet and margins. It describes business quality, not whether the price is attractive.
| Profitability | 5 of 5 years profitable | 20 / 20 |
| Cash generation | free cash flow positive in 5 of 5 years | 20 / 20 |
| Growth | revenue +16.0% a year | 20 / 20 |
| Balance sheet | net cash | 20 / 20 |
| Margins | EBITDA margin 26% | 20 / 20 |
Peers in Financials
Same-sector companies with a valuation, most undervalued first. Compare the margin of safety, yield and quality score side by side.
| Company | Price | Margin of safety | P/E | P/B | Yield | Quality |
|---|---|---|---|---|---|---|
| HSBA.L (this company) | GBP 12.98 | -21.6% | 13.7 | 1.7 | 3.8% | 100 |
| PSH.L Pershing Square Holdings, Ltd. | GBP 38.44 | 68.5% | 3.6 | 0.6 | 1.3% | 76 |
| LRE.L Lancashire Holdings Limited | GBP 6.88 | 45.6% | 7.1 | 1.6 | 3.3% | 76 |
| ACA.PA Credit Agricole S.A. | EUR 15.73 | 36.6% | 6.7 | 0.7 | 7.0% | 78 |
| V Visa Inc. | USD 414.00 | 34.6% | 8.7 | – | 0.2% | 100 |
| PRU.L Prudential plc | GBP 9.24 | 34.2% | 8.0 | 1.6 | 1.9% | 78 |
| AGS.BR ageas SA/NV | EUR 76.95 | 33.0% | 8.1 | 1.5 | 5.0% | 76 |
| NWG.L NatWest Group plc | GBP 5.86 | 30.3% | 8.2 | 1.3 | 5.0% | 88 |
| ACGL Arch Capital Group | USD 108.49 | 30.3% | 8.5 | 1.6 | 0.1% | 100 |
| Peer median | 8.1 | 1.5 | ||||
Dividends
Paid in the last 12 months: GBP 0.01 per share · yield 0.04% at the current price.
| Year | Dividends per share |
|---|---|
| 2026 (so far) | 0.006 |
| 2025 | 0.005 |
| 2024 | 0.006 |
| 2023 | 0.004 |
| 2022 | 0.002 |
| 2021 | 0.002 |
Annual financial statement
Saved annual report · Fiscal year 2025 · EODHD annual statements · period ended 31 Dec 2025
| Revenue | GBP 100,321,393,199 |
|---|---|
| EBITDA | GBP 26,051,782,095 |
| EBIT | GBP 22,374,024,269 |
| Net income | GBP 16,671,853,774 |
| Free cash flow | GBP 18,781,552,121 |
| Capital expenditures | GBP 3,486,987,231 |
| Debt | GBP 373,527,197,355 |
| Cash | GBP 455,780,025,203 |
| Working capital | GBP 185,804,907,610 |
| Shares outstanding | 17,547,000,000 |
| Reported dividends per share | GBP 0.4938 |