HSBC (#HSBA) – UK subsidiary “acquiring Silicon Valley Bank UK Limited for £1”
- 2023-03-13 07:59:49
Hello Share Smokers. What with worries about China, Ukraine, supply problems et al, you would expect the Honkers Bonkers bank (HSBA) to be up against it. Not so, according to the latest half year results. HSBC’s big cheese said ‘We are confident of achieving a return on tangible equity of at least 12% from 2023 onwards, which would represent our best returns in a decade.’
Three weeks ago, I told you why it was wise to buy shares in Johnson Matthey (JMAT); so, it was pleasing to see a near 20% rise in its shares on Friday, after Standard Industries took a 5% stake. A potential bidder, or just a smart investor? Could be either. What I do know is that, in my opinion, the share is still cheap, and it makes more sense for it to be in the 2500-3000p range than a 22 quid-plus share price. So, this one remains a BUY for me. But whilst this one is an easy hold, what about HSBC (HSBA)...?
I remember - about 25 years ago - that my first boss told me a story concerning a previous contact of his who had bought shares in HSBC (HSBA) many years beforehand and it had provided a fantastic total return profile for the next few decades. Such is the attraction of thinking a bit like Warren Buffett and spotting an idea that is set to continue to perform well for the next thirty or forty years – and holding on. However, hindsight is easy to quote but harder to achieve. And whilst I have my own list of names I anticipate my pension fund is unlikely to sell its holding in during the rest of the 2020s, unsurprisingly this list does not include HSBC which I dumped about 4 years ago (at an akin share price I had purchased the stock at about 4 years earlier). The ‘Hongkong and Shanghai Banking Corporation Limited’ is a flash name, but despite the rise and rise of Asia over recent decades, any HSBC shareholder will be aware that the shares peaked in the year 2000.
I had to use the ShareProphets search engine to find the last time I wrote exclusively about banking behemoth HSBC (HSBA). Remarkably it was back in 2015 here when I employed the quite witty title of 'HSBC: Hooray Some Bloomin’ Cost cuts'. Sometimes I really think I should retire as I have set the historic barrier too high...