HSBC Share Price: Fourth-Quarter Profits Jump, Beating Analysts’ Estimates

HSBC share price has been hovering above its highest level in three years for the past few weeks. The HSBA stock has gained more than 19% in the year to date and has been among the top-performing stocks on the London Stock Exchange. The stock ended its previous trading session slightly lower ahead of its earnings report on Tuesday.

Earnings Report

HSBC share price will be in the spotlight on Tuesday after the British bank announced its fourth-quarter earnings. HSBC, Europe’s largest bank by assets, reported quarterly profits jumped 92%, beating analysts’ expectations.

The bank reported pre-tax profits for the three months ending ended in December were $5.2 billion, up from $2.7 billion a year earlier and ahead of the $4.96 billion in estimates compiled by the bank. According to the bank, the fourth-quarter results reflect strong reported revenue growth and lower reported operating expenses.

HSBC reported full-year revenue of $51.73 billion, up from $49.55 billion in 2021. Despite the surge in the fourth quarter, annual profit slipped to $17.5 billion, down from $18.9 billion in the previous year. On the credit side, the bank’s annual expected credit losses rose to $3.6 billion, ahead of the estimated $3.2 billion due to corporate exposures in the UK and lingering problems in mainland China commercial real estate.

In its earning statement, HSBC’s Chief Executive Noel Quinn said that the bank is on track to deliver higher returns in 2023. The bank maintained its key performance target of reaching a return on tangible equity of at least 12% this year.

HSBC Share Price Forecast

HSBC Share price has been on a strong rally since the start of the year, jumping more than 42% from its lowest level in October 2022. The HSBA stock has managed to remain above the 25-day and 50-day moving averages. Its Relative Strength Index (RSI) has been hovering around the overbought region.

Therefore, with the bank’s confidence for 2023, the HSBA stock price is likely to edge higher. If this happens, bulls will be targeting the next resistance level at 675p. However, a breach below the important support level at 600p will invalidate the bullish thesis.

HSBA Price Chart

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