HSBC Holdings PLC (LSE:HSBA) shares were little moved after the FTSE 100 bank posted its final results, with analysts saying there was little to change opinions with the shares close to a 20-year high.
Analysts at UBS said underlying fourth-quarter profit before tax was 9% above the consensus forecast, with net interest income slightly ahead of estimates and net interest margin also a beat.
A CET1 capital ratio of 14.9% was very slightly below consensus expectations, while a dividend of 36c per share and $2 billion buyback compared with forecasts of 34c and $2.3 billion respectively.
Jefferies analyst said: “Some investors would have hoped for a better than $2 billion share buyback, but we read this as time-constrained," given that HSBC said it would complete the buyback by the first-quarter results, which would be expected by late April or early May.
Analyst Gary Greenwood at Shore Capital said: “Overall, there is probably more for the market to like than not here, but the shares are now trading close to a 20-year high and look increasingly up with events.”
Updated guidance from HSBC's new CEO Georges Elhedery sees the previous "mid-teens" RoTE extended out to the 2027 financial year, which is better than the market expected.
Guidance also included a $1.5 billion reduction in the cost base by the end of 2026, though the job cuts will require £1.8 billion in severance and other costs.
Greenwood said the severance costs will be "a drag on near-term reported profitability", but overall he expects underlying consensus forecasts to "move upwards".
Broker Keefe, Bruyette & Woods said it was a "respectable set" of Q4 numbers, with adjusted PBT driven by "better income; costs; and associates, partially offset by higher impairments".
Overall, KBW said HSBC is "comfortably the most expensive UK bank", trading at 8.3x 2026 earnings versus a UK average of 7.1x.
"This is tough to justify for a company delivering little loan growth and targeting mid-teens returns, but ex notable items - an artificial measure that has thankfully largely disappeared from the sector.
"Some may argue that HSBC has traditionally traded at a premium to UK banks, but to suggest that Asia / Hong Kong is the same opportunity as it was 15 year ago is obviously flawed."
Cash returns "do support the downside", KBW added, but it was "tough to justify" more than its current 'market perform' rating.