HSBC Shifts U.S. Equity Rating to Neutral, Reports 1.7x P/BV and 4% Yield
HSBC shifted its U.S. equities rating to neutral after revised payroll data showed 2025 labor growth was narrower, aligning with BCA Research's similar move. Its 2025 earnings showed modest revenue growth, persistent restructuring charges, and a decade-high 1.7x price-to-book valuation alongside a roughly 4% dividend yield.
1. Shift to Neutral on U.S. Equities
HSBC revised its U.S. equity rating to neutral on Thursday after detailed annual payroll revisions revealed that 2025 labor growth was more narrowly concentrated and below the bank's stall-speed threshold. The move reflects a cautious view on future hiring trends despite an economy that continues to expand, prompting HSBC to rebalance its sector allocations.
2. 2025 Earnings and Valuation Metrics
For the full year 2025, HSBC reported modest revenue growth alongside recurring one-off items and ongoing restructuring charges, which restrained net profit gains. The bank’s price-to-book ratio climbed to a decade-high 1.7x and it maintained a dividend yield near 4% while pressing ahead with cost-saving initiatives and business streamlining to improve efficiency.