HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

Morpheus
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15 years 5 months ago #616 by Morpheus

HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days was created by Morpheus

I could not believe my eyes when I saw HSBC price today. A mere HK$75. The stock has fallen some 23% on Friday and Monday, due to concerns over its earnings visibility. To me, these are nonsensical statements. HSBC, to many fund managers, is the Berkshire Hathaway of the East. The management is top class and best of all, conservative. HSBC is the first bank to write off and closed down their subprime mortgage division in 2007, stating that they are uncomfortable with this business. Late 2007, they are also among the first bank to warn of a global economic downturn given the credit crunch crisis in USA. Currently, the stock is trading at historic 4.3x PE and a dividend yield of more than 12%. Forget about DBS, UOB or OCBC. Even the preference shares of OCBC is offering only 6% after a nearly 20% fall in the share price. Go for the Berkshire Hathaway of the East -- HSBC

What is this selldown in HSBC telling me? I believe the bottom is near. This mother of all stocks would be the last to be sold off in any good fund manager\'s portfolio. Now, they need to sell this stock to raise cash for their portfolios. This could seriously mean that the exposure to equity for these so-called investors is down to nearly nil.

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Mel
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15 years 5 months ago #618 by Mel

Replied by Mel on topic Re:HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

what is the world coming to? these are extraordinarily turbulent times. no doubt a lot of stocks are at levels never to be visited again, but investors are very risk averse now. the whole world is going into a slowdown and it\'s prudent - better safe than sorry - to be conservative and stay on the sidelines of the market.

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MacGyver
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15 years 5 months ago - 15 years 5 months ago #619 by MacGyver

Replied by MacGyver on topic Re:HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

Two of the best-managed banks in the world are probably HSBC and Standard Chartered. Have faith in these management. Really top class people, good vision and execution skills.

Last edit: 15 years 5 months ago by MacGyver.

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Morpheus
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15 years 5 months ago #621 by Morpheus

Replied by Morpheus on topic Re:HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

Sitting on a 10% profit now. Good money for a day\'s work... Time to exit. This rally will not last long. More pain to come....

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ELLEN
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15 years 5 months ago #625 by ELLEN

Replied by ELLEN on topic Re:HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

HSBC & Stanchart had navigated the Asian crisis and the experience informed the way they manage their liquidity, capital, risk management and so on and that stood them in good stead. Also, they are the 2 British banks which do not require the re-capitalisation offered by UK govt. :woohoo: :woohoo:

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MacGyver
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15 years 5 months ago #632 by MacGyver

Replied by MacGyver on topic Re:HSBC -- Berkshire Hathaway of the East dropped 23% in 2 days

Agreed. These management know how to grow the businesses in a recession. Not too sure about the Singapore banks though. :laugh:

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