Invest In HSBC Stock For 35% Gains

Invest In HSBC Stock For 35% Gains

HONG KONG, CHINA - 2020/11/12: Client are seen withdrawing cash from the British multinational ... [+] banking HSBC ATM machines in Hong Kong. (Photo by Budrul Chukrut/SOPA Images/LightRocket via Getty Images)



SOPA Images/LightRocket via Getty Images

HSBC stock (NYSE: HSBC) has 35% upside (to pre-crisis level) in 1-2 years as the lower interest rate environment improves and GDP sees some recovery, leading to a growth in total loans and net interest income. HSBC stock currently trades near $27 and it has lost around 32% in value so far this year. It traded at a pre-Covid high of $36 in February, and it is 26% below that level now. Also, the stock has further lost around 5% since its March market lows of $28 after the multi-billion dollar stimulus package announced by the U.S. government, which has helped the stock market recover to a large extent. The stock is lagging the broader markets by a huge margin (S&P 500 is up about 60%), as investors are cautious about the impact of lower interest rates and higher provision for loan losses on its profitability – profit after tax is down 46% y-o-y in Q3 and 62%