Morgan Stanley: HSBC Holdings (00005) share price expected to rise relative to the broader market over the next 15 days

Stock News14:54

According to a research report released by Morgan Stanley, the recent pullback in HSBC Holdings (00005) has made its short-term valuation more attractive. The bank believes the recent correction has been excessive and expects the share price to rise relative to the broader market index over the next 15 days. The target price is HK$173, with an "Overweight" rating.

The bank noted that HSBC Holdings' third-quarter results showed that wealth management fund flows remained solid, and the group is expected to have greater capital flexibility in 2027. Rising deposit competition will put pressure on net interest margins, but HSBC Holdings is in a better position than many of its peers.

The current price implies a forecast dividend yield of 5.4% for 2027 and a price-to-earnings ratio of 9.4 times. The bank considers this valuation attractive relative to Hong Kong and ASEAN financial stocks.

The bank estimates the probability of this scenario occurring at approximately 70% to 80% (i.e., "highly likely").

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