Validea Joseph Piotroski Strategy Daily Upgrade Report - 10/30/2024
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 30 2024
0mins
Should l Buy HSBC?
Source: NASDAQ.COM
HSBC Holdings PLC Rating Update: HSBC's rating based on Joseph Piotroski's value-quant strategy has improved significantly from 0% to 80%, indicating strong interest in the stock due to its solid fundamentals and valuation.
About Joseph Piotroski and Validea: Joseph Piotroski, an accounting professor, developed a successful stock-selection method that outperformed the S&P 500, and Validea utilizes strategies from various investment legends for stock analysis and model portfolios.
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Analyst Views on HSBC
About HSBC
HSBC Holdings plc (HSBC) is a banking and financial services company. Its business segments include Hong Kong, UK, Corporate and Institutional Banking (CIB), and International Wealth and Premier Banking (IWPB). Its Hong Kong business comprises retail banking and wealth and commercial banking of HSBC Hong Kong and Hang Seng Bank. Its UK business comprises UK retail banking and wealth (including first direct and M&S Bank) and UK commercial banking, including HSBC Innovation Bank. The CIB segment is formed from the integration of its commercial banking business (outside the UK and Hong Kong) with its global banking and markets business. The IWPB segment comprises premier banking outside of Hong Kong and the UK, its global private bank, and its asset management, insurance and investment distribution businesses. Its customers worldwide through a network covering 58 countries and territories. Its customers range from individual savers and investors to companies, governments and others.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Current Purchases of a Leading International ETF
Investment Opportunity: The Lazard International Dynamic Equity exchange-traded fund is highlighted as a strong choice for investors looking for international stocks post-Iran war decline.
Advantages Over Index Funds: This fund offers exposure to various countries and sectors similar to foreign index funds, but it focuses on higher-quality stocks.
See More
HSBC Upgrades Block with Bullish Earnings Outlook
- Earnings Forecast Upgrade: HSBC analyst Saul Martinez raised Block's 2026 adjusted operating earnings estimate by approximately 20% and lifted the EPS forecast by 16%, reflecting confidence in the company's future earnings potential.
- Target Price Increase: HSBC raised Block's target price from $70 to $77, indicating around 20% upside potential for the stock, which reflects a positive outlook on its valuation.
- Layoff Plan Interpretation: Despite Block's plan to cut nearly half its workforce, HSBC emphasized that this move is not a response to operational stress but rather aimed at significantly enhancing earnings power, noting the company's healthy financial performance.
- Back-Loaded Earnings Growth: HSBC highlighted that earnings improvements are primarily expected in the second half of 2026, with about 60% of adjusted operating earnings projected to be generated then, suggesting that 2027 consensus estimates may be too low.
See More
Contrarian Capital Reduces Stake in Core Natural Resources
- Stake Reduction Details: Contrarian Capital Management reduced its stake in Core Natural Resources by 187,676 shares in Q4 2026, resulting in a decrease to 0.7359% of the fund's 13F assets, indicating a waning market confidence in the stock.
- Financial Impact Analysis: This reduction led to a decline in the quarter-end value of Core Natural Resources by approximately $15.51 million, highlighting how both market price movements and share sales have affected the company's market performance.
- Market Performance Comparison: As of February 13, 2026, Core Natural Resources shares were priced at $91.51, reflecting an 8.03% increase over the past year, yet underperforming the S&P 500 by 3.76 percentage points, suggesting insufficient market competitiveness.
- Investor Outlook: The coal market has stabilized post-global energy shock, and Core's future earnings will depend on whether coal prices remain above production costs, making it crucial for investors to monitor this gap to assess the sustainability of the company's cash flow.
See More
HSBC Plans to Sell Singapore Life Insurance Business for Over $1B
- Sale Plan: HSBC Holdings is looking to sell its Singapore life insurance product manufacturing business in a deal expected to exceed $1 billion, aiming to streamline its operations and focus on core strengths.
- Revenue Performance: The manufacturing operations recorded approximately $2.3 billion in revenue last year, highlighting its significance in the market and the attractiveness for potential buyers.
- Advisor Appointment: HSBC has hired JPMorgan as its advisor for the transaction, indicating the importance of the deal and the desire to expedite the process with professional support.
- Potential Buyers: HSBC has engaged with potential buyers including Nippon Life and Dai-ichi Life, with non-binding bids expected within a month, further advancing the transaction's progress.
See More
Impact of Trump's Tariffs on the U.S. Economy
- Tariff Impact Analysis: Numerous studies indicate that Trump's tariff policies have imposed most costs on U.S. businesses and consumers, and despite the Supreme Court striking down some duties, Trump has replaced them with a 10% global tariff, exacerbating economic uncertainty.
- Investor Shift Trend: Due to uncertainty about economic impacts, some investors have moved money from U.S. stocks to international markets, resulting in the S&P 500 trading sideways this year while the Vanguard FTSE Pacific ETF rose by 18% and the Vanguard FTSE Developed Markets ETF increased by 11%.
- ETF Performance Comparison: The Vanguard FTSE Pacific ETF tracks about 2,300 Asia-Pacific companies and has outperformed the S&P 500 by nearly 18 percentage points year-to-date, primarily due to strong performances from Samsung and SK Hynix, despite lagging by about 150 percentage points over the past decade.
- Market Outlook: While the Vanguard FTSE Developed Markets ETF has outperformed the S&P 500 by nearly 11 percentage points year-to-date, it has not performed as well as the Vanguard FTSE Pacific ETF due to less exposure to chip manufacturers, indicating potential challenges ahead.
See More
U.S. Stock Market Underperforms as International Markets Surge
- International Market Surge: The Vanguard FTSE Pacific ETF has risen 18% year-to-date, primarily benefiting from strong performances in stocks from Japan, South Korea, and Australia, indicating increased investor confidence in international markets, which may lead to capital outflows from the U.S.
- Economic Concerns in the U.S.: Experts widely believe that President Trump's tariff policies will negatively impact the U.S. economy, causing businesses and consumers to bear most of the costs, thereby exacerbating market uncertainty and affecting investor confidence.
- Surge in Memory Chip Demand: The performance of major memory chip manufacturers like Samsung and SK Hynix, driven by unprecedented demand for AI infrastructure, has propelled the Vanguard FTSE Pacific ETF's gains, although cyclical fluctuations in the memory industry may pose future challenges.
- Significant Fee Ratio Advantage: The Vanguard FTSE Pacific ETF boasts an expense ratio of 0.07%, significantly lower than the average 0.68% for similar funds, making it an attractive option for investors seeking exposure to Asia-Pacific stocks, despite its underperformance compared to the S&P 500 over the past decade.
See More
Current Purchases of a Leading International ETF
Investment Opportunity: The Lazard International Dynamic Equity exchange-traded fund is highlighted as a strong choice for investors looking for international stocks post-Iran war decline.
Advantages Over Index Funds: This fund offers exposure to various countries and sectors similar to foreign index funds, but it focuses on higher-quality stocks.
See More
HSBC Upgrades Block with Bullish Earnings Outlook
- Earnings Forecast Upgrade: HSBC analyst Saul Martinez raised Block's 2026 adjusted operating earnings estimate by approximately 20% and lifted the EPS forecast by 16%, reflecting confidence in the company's future earnings potential.
- Target Price Increase: HSBC raised Block's target price from $70 to $77, indicating around 20% upside potential for the stock, which reflects a positive outlook on its valuation.
- Layoff Plan Interpretation: Despite Block's plan to cut nearly half its workforce, HSBC emphasized that this move is not a response to operational stress but rather aimed at significantly enhancing earnings power, noting the company's healthy financial performance.
- Back-Loaded Earnings Growth: HSBC highlighted that earnings improvements are primarily expected in the second half of 2026, with about 60% of adjusted operating earnings projected to be generated then, suggesting that 2027 consensus estimates may be too low.
See More
Contrarian Capital Reduces Stake in Core Natural Resources
- Stake Reduction Details: Contrarian Capital Management reduced its stake in Core Natural Resources by 187,676 shares in Q4 2026, resulting in a decrease to 0.7359% of the fund's 13F assets, indicating a waning market confidence in the stock.
- Financial Impact Analysis: This reduction led to a decline in the quarter-end value of Core Natural Resources by approximately $15.51 million, highlighting how both market price movements and share sales have affected the company's market performance.
- Market Performance Comparison: As of February 13, 2026, Core Natural Resources shares were priced at $91.51, reflecting an 8.03% increase over the past year, yet underperforming the S&P 500 by 3.76 percentage points, suggesting insufficient market competitiveness.
- Investor Outlook: The coal market has stabilized post-global energy shock, and Core's future earnings will depend on whether coal prices remain above production costs, making it crucial for investors to monitor this gap to assess the sustainability of the company's cash flow.
See More
HSBC Plans to Sell Singapore Life Insurance Business for Over $1B
- Sale Plan: HSBC Holdings is looking to sell its Singapore life insurance product manufacturing business in a deal expected to exceed $1 billion, aiming to streamline its operations and focus on core strengths.
- Revenue Performance: The manufacturing operations recorded approximately $2.3 billion in revenue last year, highlighting its significance in the market and the attractiveness for potential buyers.
- Advisor Appointment: HSBC has hired JPMorgan as its advisor for the transaction, indicating the importance of the deal and the desire to expedite the process with professional support.
- Potential Buyers: HSBC has engaged with potential buyers including Nippon Life and Dai-ichi Life, with non-binding bids expected within a month, further advancing the transaction's progress.
See More
Impact of Trump's Tariffs on the U.S. Economy
- Tariff Impact Analysis: Numerous studies indicate that Trump's tariff policies have imposed most costs on U.S. businesses and consumers, and despite the Supreme Court striking down some duties, Trump has replaced them with a 10% global tariff, exacerbating economic uncertainty.
- Investor Shift Trend: Due to uncertainty about economic impacts, some investors have moved money from U.S. stocks to international markets, resulting in the S&P 500 trading sideways this year while the Vanguard FTSE Pacific ETF rose by 18% and the Vanguard FTSE Developed Markets ETF increased by 11%.
- ETF Performance Comparison: The Vanguard FTSE Pacific ETF tracks about 2,300 Asia-Pacific companies and has outperformed the S&P 500 by nearly 18 percentage points year-to-date, primarily due to strong performances from Samsung and SK Hynix, despite lagging by about 150 percentage points over the past decade.
- Market Outlook: While the Vanguard FTSE Developed Markets ETF has outperformed the S&P 500 by nearly 11 percentage points year-to-date, it has not performed as well as the Vanguard FTSE Pacific ETF due to less exposure to chip manufacturers, indicating potential challenges ahead.
See More
U.S. Stock Market Underperforms as International Markets Surge
- International Market Surge: The Vanguard FTSE Pacific ETF has risen 18% year-to-date, primarily benefiting from strong performances in stocks from Japan, South Korea, and Australia, indicating increased investor confidence in international markets, which may lead to capital outflows from the U.S.
- Economic Concerns in the U.S.: Experts widely believe that President Trump's tariff policies will negatively impact the U.S. economy, causing businesses and consumers to bear most of the costs, thereby exacerbating market uncertainty and affecting investor confidence.
- Surge in Memory Chip Demand: The performance of major memory chip manufacturers like Samsung and SK Hynix, driven by unprecedented demand for AI infrastructure, has propelled the Vanguard FTSE Pacific ETF's gains, although cyclical fluctuations in the memory industry may pose future challenges.
- Significant Fee Ratio Advantage: The Vanguard FTSE Pacific ETF boasts an expense ratio of 0.07%, significantly lower than the average 0.68% for similar funds, making it an attractive option for investors seeking exposure to Asia-Pacific stocks, despite its underperformance compared to the S&P 500 over the past decade.
See More
