Direct comparison: Eastern Bankshares (NASDAQ:EBC) and HSBC (NYSE:HSBC)

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Eastern Bankshares (NASDAQ:EBC – Get Rating) and HSBC (NYSE:HSBC – Get Rating) are both finance companies, but which stock is superior? We’ll compare the two companies based on the strength of their earnings, dividends, profitability, analyst recommendations, valuation, risk, and institutional ownership.

Insider and Institutional Ownership

59.0% of Eastern Bankshares shares are held by institutional investors. By comparison, 1.1% of HSBC shares are held by institutional investors. 1.4% of Eastern Bankshares shares are held by insiders. Strong institutional ownership indicates that endowments, hedge funds, and large money managers believe a stock is poised for long-term growth.

Risk and Volatility

Eastern Bankshares has a beta of 0.97, suggesting its stock price is 3% less volatile than the S&P 500. In comparison, HSBC has a beta of 0.51, suggesting its stock price is 49% less volatile than the S&P 500.

Profitability

This table compares Eastern Bankshares and HSBC’s net margins, return on equity and return on assets.

Net margins Return on equity return on assets
Eastern Bank Actions 25.67% 5.79% 0.89%
HSBC 27.66% 6.61% 0.46%

Valuation and benefits

This table compares the gross revenue, earnings per share (EPS) and valuation of Eastern Bankshares and HSBC.

Gross revenue Price/sales ratio Net revenue Earnings per share Price/earnings ratio
Eastern Bank Actions $628.31 million 5.99 $154.66 million $1.03 19.86
HSBC $49.55 billion 2.71 $13.92 billion $3.35 9.81

HSBC has higher revenues and profits than Eastern Bankshares. HSBC trades at a lower price-to-earnings ratio than Eastern Bankshares, indicating that it is currently the more affordable of the two stocks.

Dividends

Eastern Bankshares pays an annual dividend of $0.40 per share and has a dividend yield of 2.0%. HSBC pays an annual dividend of $1.24 per share and has a dividend yield of 3.8%. Eastern Bankshares pays 38.8% of its profits as a dividend. HSBC distributes 37.0% of its profits as a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings over the next few years. HSBC is clearly the better dividend-paying stock, given its higher yield and lower payout ratio.

Analyst Recommendations

This is a summary of recent recommendations and price targets for Eastern Bankshares and HSBC, as provided by MarketBeat.com.

Sales Ratings Hold odds Buy reviews Strong buy odds Rating
Eastern Bank Actions 0 1 1 0 2.50
HSBC 0 5 6 0 2.55

Eastern Bankshares currently has a consensus price target of $22.75, indicating a potential upside of 11.19%. Given Eastern Bankshares’ possible higher upside, analysts clearly think Eastern Bankshares is more favorable than HSBC.

Summary

HSBC beats Eastern Bankshares on 9 out of 16 factors compared between the two stocks.

About Eastern Bankshares

(Get a rating)

Eastern Bankshares, Inc. operates as a banking holding company for Eastern Bank which provides banking products and services primarily to individuals, businesses and small businesses. It operates in two segments, banking business and insurance agency business. The Company provides interest-bearing and non-interest-bearing checking deposits, money market deposits, savings deposits and term deposit certificates, as well as debit and credit cards. It also offers commercial and industrial loans, commercial real estate and construction loans, small business loans, residential real estate loans, equity and lines of credit, and other consumer loans including lines of unsecured personal credit, overdraft protection, car loans, home improvement loans, airplane loans and other personal loans. In addition, the company provides cash reserves, cash management, merchants, express escrow, government banking, international banking, attorney trust account interest, retirement planning and business telephone banking, and not-for-profit products and services. and health care. In addition, it offers trust and investment products and services; community development and asset-based lending services; financial planning, portfolio management, wealth management, private banking and fiduciary products; online, mobile and telephone banking; and automated post office box collection and account reconciliation services, as well as various insurance products. As of December 31, 2021, the company operated 105 branches in eastern Massachusetts and southern New Hampshire; and 23 out-of-branch offices in eastern Massachusetts, one office in New Hampshire and one office in Rhode Island. Eastern Bankshares, Inc. was founded in 1818 and is headquartered in Boston, Massachusetts.

About HSBC

(Get a rating)

HSBC LogoHSBC Holdings plc provides banking and financial services worldwide. The Company operates through Wealth and Personal Banking, Commercial Banking and World Banking and Markets segments. The Wealth and Personal Banking segment offers retail banking and wealth management products, including current and savings accounts, mortgages and personal loans, credit and debit cards, and local and international payment services ; and wealth management services including insurance and investment products, global asset management services, investment management and private wealth management solutions. This segment serves individuals and high net worth individuals. The Commercial Banking segment provides credit and lending, cash management, payment, cash management, commercial insurance and investment services; business cards; international trade and debt financing services; foreign exchange products; capital raising services in the debt and equity markets; and advisory services. It serves small and medium-sized businesses, mid-market businesses, and large enterprises. The Global Banking and Markets segment offers financing, advisory and transaction services; and credit, rates, foreign exchange, equity, money markets and securities services; and engages in primary investment activities. It serves government, corporate and institutional clients, as well as private investors. HSBC Holdings plc was founded in 1865 and is headquartered in London, UK.



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