Hang Seng Bank Limited

DB:HSB Stock Report

Market Cap: €21.4b

Hang Seng Bank Valuation

Is HSB undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of HSB when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: HSB (€11.2) is trading below our estimate of fair value (€19.9)

Significantly Below Fair Value: HSB is trading below fair value by more than 20%.

Key Valuation Metric

Which metric is best to use when looking at relative valuation for HSB?

Key metric: As HSB is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.

The above table shows the Price to Earnings ratio for HSB. This is calculated by dividing HSB's market cap by their current earnings.
What is HSB's PE Ratio?
PE Ratio10.1x
EarningsHK$17.21b
Market CapHK$173.45b

Price to Earnings Ratio vs Peers

How does HSB's PE Ratio compare to its peers?

The above table shows the PE ratio for HSB vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PEEstimated GrowthMarket Cap
Peer Average8.7x
CBK Commerzbank
8.5x8.8%€18.2b
PCZ ProCredit Holding
4.2x9.9%€450.0m
MBK Merkur PrivatBank KgaA
10x8.6%€107.3m
2891 CTBC Financial Holding
11.9x2.3%NT$740.7b
HSB Hang Seng Bank
10.1x1.7%€173.5b

Price-To-Earnings vs Peers: HSB is expensive based on its Price-To-Earnings Ratio (10.1x) compared to the peer average (8.7x).

Price to Earnings Ratio vs Industry

How does HSB's PE Ratio compare vs other companies in the European Banks Industry?

2 CompaniesPrice / EarningsEstimated GrowthMarket Cap
HSB 10.1xIndustry Avg. 7.4xNo. of Companies46PE0612182430+
2 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Earnings vs Industry: HSB is expensive based on its Price-To-Earnings Ratio (10.1x) compared to the European Banks industry average (7.4x).

Price to Earnings Ratio vs Fair Ratio

What is HSB's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

HSB PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio10.1x
Fair PE Ratio10.6x

Price-To-Earnings vs Fair Ratio: HSB is good value based on its Price-To-Earnings Ratio (10.1x) compared to the estimated Fair Price-To-Earnings Ratio (10.6x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst HSB forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Current€11.20
€11.59
+3.5%
8.3%€13.34€9.58n/a11
Nov ’25€11.20
€11.02
-1.6%
8.3%€12.68€9.11n/a11
Oct ’25€11.20
€11.02
-1.6%
8.3%€12.68€9.11n/a11
Sep ’25€10.80
€11.27
+4.3%
8.2%€12.89€9.37n/a11
Aug ’25€10.80
€11.48
+6.3%
7.9%€13.04€9.49n/a11
Jul ’25€11.80
€12.27
+4.0%
7.4%€14.22€10.99n/a12
Jun ’25€12.70
€12.13
-4.5%
7.4%€14.05€10.86n/a12
May ’25€12.30
€12.19
-0.9%
7.5%€14.27€11.03n/a12
Apr ’25€10.00
€11.67
+16.7%
9.7%€14.05€10.20n/a12
Mar ’25€10.40
€11.67
+12.2%
9.7%€14.05€10.20n/a12
Feb ’25€9.55
€11.85
+24.1%
10.9%€13.93€9.90n/a12
Jan ’25€10.40
€12.00
+15.4%
11.1%€13.89€10.16n/a12
Dec ’24€10.10
€12.82
+26.9%
11.4%€15.88€10.27n/a11
Nov ’24€10.60
€13.59
+28.2%
9.7%€16.21€11.33€11.2011
Oct ’24€11.60
€13.59
+17.1%
9.7%€16.21€11.33€11.2011
Sep ’24€11.50
€13.88
+20.7%
8.1%€15.89€12.27€10.8011
Aug ’24€13.30
€14.67
+10.3%
10.0%€17.29€13.20€10.8011
Jul ’24€13.40
€16.10
+20.1%
13.3%€20.58€12.60€11.8011
Jun ’24€12.50
€16.10
+28.8%
13.3%€20.58€12.60€12.7011
May ’24€13.30
€16.24
+22.1%
12.3%€20.65€13.34€12.3011
Apr ’24€13.00
€16.93
+30.2%
10.8%€21.24€14.56€10.0011
Mar ’24€15.40
€17.07
+10.8%
10.7%€21.39€14.90€10.4011
Feb ’24€15.00
€16.50
+10.0%
15.0%€20.67€12.77€9.5511
Jan ’24€15.50
€17.75
+14.5%
13.3%€21.73€14.04€10.4011
Dec ’23€14.90
€17.75
+19.1%
13.3%€21.73€14.04€10.1011
Nov ’23€14.10
€19.25
+36.5%
12.4%€23.21€15.00€10.6011

Analyst Forecast: Target price is less than 20% higher than the current share price.

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