7 Best European Bank Stocks To Invest In

03. HSBC Holdings plc (NYSE:HSBC)

Number of Hedge Fund Holders: 14

HSBC Holdings plc (NYSE:HSBC) stands at number three on our list of seven best European bank stocks to invest in. HSBC Holdings plc (NYSE:HSBC) recent first-half 2024 results affirm the bank’s strong growth trajectory, particularly in wealth management and corporate banking across key markets like Hong Kong, the UK, and the Greater Bay Area. The bank reported revenue of $37.3 billion, a 1.1% year-over-year increase, and earnings per share grew slightly to $0.88 from $0.86 despite a marginal decline in post-tax profits.

Notably, HSBC Holdings plc (NYSE:HSBC) aggressive share buyback program reduced its outstanding shares, leading to an impressive 17% return on tangible equity. The bank’s strategic focus on expanding its wealth management division has begun to bear fruit, with wealth revenue up 12% over the past two quarters. This segment remains a critical growth driver as HSBC Holdings plc (NYSE:HSBC) attracts new clients and increases assets under management, particularly in Hong Kong, where the bank onboarded 345,000 new customers in just six months.

In the UK, HSBC Holdings plc (NYSE:HSBC) also demonstrated robust performance, with a pre-tax profit of $3.7 billion, an 11% increase year-over-year. The bank’s growing presence in the UK mortgage market, with a market share of 8.1%, reflects its solidified position in this region. Additionally, HSBC’s successful hedging strategies have mitigated potential downsides from anticipated declines in net interest margins (NIM) as interest rates fluctuate.

Valuation metrics underscore HSBC Holdings plc (NYSE:HSBC) attractiveness, trading at a P/E ratio of 7.7 with a dividend yield of 6.86%, positioning it as a compelling value compared to peers like JPMorgan Chase & Co. Management’s commitment to shareholder returns, evidenced by consistent dividend payouts and share buybacks, further strengthens the investment case. With continued growth in key regions, strategic focus on high-margin segments, and disciplined cost management, HSBC Holdings plc (NYSE:HSBC) is well-positioned for sustained long-term growth, making it a strong buy for investors seeking stable returns in the financial sector.

In the second quarter of 2024, there were 14 hedge funds holding positions in HSBC Holdings plc (NYSE:HSBC), as compared to 17 in the previous quarter according to Insider Monkey’s database. The total value of these holdings is approximately $0.06 billion. Ken Griffin’s Citadel Investment Group held the largest stake among these hedge funds during this period.