The brokerage says the lender is its top Asian bank pick
Goldman Sachs has raised its share target price for HSBC Holdings to $121 from $104 amid expectations of improving economic growth in its key markets in Europe, Asia and the Americas and a robust earnings outlook for this year and next.
The banking giant, which closed at $102.50 yesterday, already has an 'outperform' rating from the United States investment bank. In the past 12 months the stock has gained 20.9 per cent, compared with a 17.5 per cent rise for the Hang Seng Index.
'HSBC remains our top Asia bank pick [and] we would add to positions now,' Goldman analysts said in a research report.
HSBC was expected to post stronger top-line growth across the board, including its two most recent acquisitions - Household International, a loan provider and credit-card services company in the US acquired in March, and Mexican financial services company Grupo Financiero Bital - the analysts said.
As a result, Goldman has raised its earnings per share forecasts for this year by 5 per cent to $6.25 and for next year by 11 per cent to $7.56, which translates into 21.2 per cent growth in earnings per share this year and 20.7 per cent next year.
