HSBC Holdings Q4 Earnings Surge! $2 Billion Buyback Plan in Focus!

TradingKey - HSBC Holdings(HSBC.N) stock reacted positively to its 2024Q4 report, which showed a strong performance reflecting the bank's strategic initiatives and effective cost management.

Key Financials Highlights 

EPS: $1.25 for FY2024, beating expectations（$1.15）with an 8.77% YoY increase, reflecting increased customer activity particularly in wealth management and securities financing.

Revenue :  10.2 billion in Q4, beating the expected $8.5 billion and up 77.9% YoY. Its pretax income came to $2.23 billion, up substantially from the prior-year Q4($977 million), including gains from the sale of its Canadian banking business and favorable impacts from foreign exchange transactions.

Operating Expenses: reached $33 billion in 2024 and up 3.0% YoY, mainly due to investment in technology and the impacts of inflation, partially offset by reduced costs from business disposals in Canada and France, and lower levies in the UK and US.

Future Outlook

Management has set clear and ambitious performance goals for 2025, aiming for an average return on tangible equity (RoTE) of around 15%, net interest income (NII) of $42 billion, with operating expense growth of 3%. Through continuous investment in digitalization and strategic expansion in Asia, HSBC is striving to enhance operational efficiency and the return for shareholders.

Moreover, as HSBC's business is more focused on Emerging Markets, its stock is relatively undervalued compared to its peers. The company initiated a share buyback program of up to $2 billion, which will likely be completed by April-end. HSBC’s strong market position, strategic initiatives, and attractive valuation may offer an appealing opportunity for long-term investors.