HSBC Annual Results 2019 media release

[Wizard]

This is beginning to read more like a thread on Polite Discussion than HYP Practical

Well back on topic, let me take the contrarian pov here (no one else has, it would seem): as a builder, I welcome the opportunity to buy more HSBA, which I expect to be still holding and funding my retirement in 20-40 years time, more cheaply.

The gap in yields between my banking preference shares (SAN, 6.1%) and ordinary shares (HSBA, 7.1%) is now wider than it has ever been. I don't see much more upside in the SAN share price so may well swap all of these for HSBA over the next couple months.

Heading off topic for this board, but I suspect you have done some analysis around reinvestment during the build phase if there is a period of reduced or no dividend on the ordinary shares. As said above the premium on the ordinary shares is a clear indication of thr market's perception of risk.

[ADrunkenMarcus]

Suspending the share buyback programme will make the dividend somewhat more expensive, as it will have to be paid on those shares which would otherwise have been bought back and cancelled.

Best wishes

Mark.

[Dod101]

Suspending the share buyback programme will make the dividend somewhat more expensive, as it will have to be paid on those shares which would otherwise have been bought back and cancelled.

Best wishes

Mark.

Quite. As I said in my post number 285084 yesterday.

Dod

[seagles]

Suspending the share buyback programme will make the dividend somewhat more expensive, as it will have to be paid on those shares which would otherwise have been bought back and cancelled.

Best wishes

Mark.

Quite. As I said in my post number 285084 yesterday.

Dod

viewtopic.php?p=285084#p285084

To give the correct format to the link.

BTW to copy/paste link to wanted post. Click on the post number of the post concerned, this will automatically copy link so you can post it with ctlr-v

[tjh290633]

Suspending the share buyback programme will make the dividend somewhat more expensive, as it will have to be paid on those shares which would otherwise have been bought back and cancelled.

Best wishes

Mark.

Only in the very long term. Just compare the price of one share with the value of the dividend to be paid on that share. There is a considerable saving over 10 or more years.

TJH

[miner1000]

If you want to see a really efficient company you should do the sums for Fevertree! HSBC provided some numbers for cost saving in the RNS today i.e. they will terminate 35,000 employees and save $4.5bn, that's an average of $128k per employee. That sure is highly paid deadwood, hopefully more to come for shareholders!

I have been following Fevertree. I would actually suggest that HSBC will have a better total return over the next 5 years than Fevertree, which in my book is overvalued and way overhyped.

Disclusure: I dont own either HSBC or Fevertree.
Just my opinion.

Miner

[Itsallaguess]

If you want to see a really efficient company you should do the sums for Fevertree! HSBC provided some numbers for cost saving in the RNS today i.e. they will terminate 35,000 employees and save $4.5bn, that's an average of $128k per employee. That sure is highly paid deadwood, hopefully more to come for shareholders!

I have been following Fevertree. I would actually suggest that HSBC will have a better total return over the next 5 years than Fevertree, which in my book is overvalued and way overhyped.

Disclusure: I dont own either HSBC or Fevertree.

Just my opinion.

Hi miner1000

I hope no-one will mind me nipping in with a slightly off-topic post just to mention that it doesn't currently look you're using the quote functionality in the most efficient manner, as the user-name of the poster your replying to is often removed from your posts where they do contain quotes. I've just had a quick look through some of your historical posts and this doesn't look like the above example is an isolated one, so I thought I'd mention it...

This makes it difficult to follow 'conversations', as it's not clear to any other reader who the quoted person is, and it's also going to be difficult for the people that you're actually replying to with regards to them knowing that you're replying to something that they've actually written..

It also stops the automatic board-notification working correctly (if people have got the correct notifications turned on), which will send a personal notification to anyone who is replied to on any board on the site, which is useful to help maintain these sorts of 'conversations' where posts are involving quotes of other posters. Hopefully you may have got one of these automatic notifications now that I've replied to your post above, and if you did then that's the notification that would not be given to the poster you're replying to above, as the board-software cannot know who to send it to...

Anyhow, I just thought I'd mention this having now seen another example of it. Hopefully it's clear from the top of this post, where it says 'miner1000 wrote' where I've quoted you 'correctly', and you can then see the section starting with 'If you want to see a really efficient company...', where you've not included the relevant section needed to capture the 'xxxxx wrote' functionality in your earlier post on this thread...

Happy to discuss via PM if the above isn't clear and I can try to help out further, so we can avoid any further 'off-topicness' on this thread....

Cheers,

Itsallaguess

[ADrunkenMarcus]

Only in the very long term. Just compare the price of one share with the value of the dividend to be paid on that share. There is a considerable saving over 10 or more years.

I suppose the opposite issue arises from when they did a rights issue in c. 2009. Pretty much all those shares will still be issued and entitled to a dividend payment.

Best wishes

Mark.

[Dod101]

If you want to see a really efficient company you should do the sums for Fevertree! HSBC provided some numbers for cost saving in the RNS today i.e. they will terminate 35,000 employees and save $4.5bn, that's an average of $128k per employee. That sure is highly paid deadwood, hopefully more to come for shareholders!

I have been following Fevertree. I would actually suggest that HSBC will have a better total return over the next 5 years than Fevertree, which in my book is overvalued and way overhyped.

Disclusure: I dont own either HSBC or Fevertree.
Just my opinion.

Miner

I did not pick up on it yesterday, but certainly as far as employee numbers are concerned we cannot compare HSBC with Fevertree since Fevertree relies on outsourcing its production. I any case we are discussing banks not soft drinks manufacturers.

Dod

[Wizard]

I did not pick up on it yesterday, but certainly as far as employee numbers are concerned we cannot compare HSBC with Fevertree since Fevertree relies on outsourcing its production. I any case we are discussing banks not soft drinks manufacturers.

Dod

Though a round of G&Ts at my local pub these days does seem to cost about the same as a months mortgage repayment on my first flat did

[tjh290633]

Only in the very long term. Just compare the price of one share with the value of the dividend to be paid on that share. There is a considerable saving over 10 or more years.

I suppose the opposite issue arises from when they did a rights issue in c. 2009. Pretty much all those shares will still be issued and entitled to a dividend payment.

Best wishes

Mark.

In that case they received a considerable amount of cash to fund the Brixton purchase. Of course they had to pay dividends on all the extra shares sold, but again a very small proportion of what was gathered in.

Share buy-backs are an abomination, if they want to "return cash to shareholders", pay higher dividends or have a special dividend.

TJH

[Arborbridge]

Suspending the share buyback programme will make the dividend somewhat more expensive, as it will have to be paid on those shares which would otherwise have been bought back and cancelled.

Best wishes

Mark.

Quite. As I said in my post number 285084 yesterday.

Dod

On the whole, I'd rather have the dividend maintained than buy backs - given a choice of only one of those prospects.

[Arborbridge]

If you want to see a really efficient company you should do the sums for Fevertree! HSBC provided some numbers for cost saving in the RNS today i.e. they will terminate 35,000 employees and save $4.5bn, that's an average of $128k per employee. That sure is highly paid deadwood, hopefully more to come for shareholders!

I have been following Fevertree. I would actually suggest that HSBC will have a better total return over the next 5 years than Fevertree, which in my book is overvalued and way overhyped.

Disclusure: I dont own either HSBC or Fevertree.
Just my opinion.

Miner

I did not pick up on it yesterday, but certainly as far as employee numbers are concerned we cannot compare HSBC with Fevertree since Fevertree relies on outsourcing its production. I any case we are discussing banks not soft drinks manufacturers.

Dod

I agree with you, Dod. I've made that point at least twice in the past two days. The original person who raised this (simoan) wasn't comparing like with like and unless one does, the comment is of next to no value. Take an extreme case: a Pc builder. Such a manufacturer might be have one or two employees but be dependant on the work of thousands of people in the background. Banks, by their nature, despite technology, I suspect are still fairly labour intensive compared with the likes of Apple who subcontract the much of their manufacture.


As regards people mentioning Fevertree, I'd also agree that HSBC has potentially better long term prospects. Fashions in drink come and go, and such companies grow fast then tend to disappear or get bought out by someone like Diageo.
Arb.

[scrumpyjack]

Their share buyback is basically to neutralise the effect of extra shares issued as scrip instead of cash.
Really don't like companies giving the option to receive a scrip dividend. It dilutes other holders and usually is a sign that the company can't really afford to pay the dividend.

[simoan]

I did not pick up on it yesterday, but certainly as far as employee numbers are concerned we cannot compare HSBC with Fevertree since Fevertree relies on outsourcing its production. I any case we are discussing banks not soft drinks manufacturers.

Dod

Where did I compare Fevertree with HSBC? I just mentioned as a fun aside to calculate the revenue per employee for Fevertree, no comparison was intended with any other company, but don't let that stop people going off at tangents and playing Chinese whispers...

I was just making a general point that we should be looking to invest in companies with high gross margins i.e. where the wage bill does not eat up a significant amount of the revenue because the revenue per employee is high. In the case of HSBC, using the figures they supplied yesterday, we can calculate the wage bill to be roughly $30bn. That's quite a lot for a company reporting revenue of $77bn and net income of $13.3bn. Particularly when the dividend costs $10bn.

All the best, Si

[88V8]

The gap in yields between my banking preference shares (SAN, 6.1%) and ordinary shares (HSBA, 7.1%) is now wider than it has ever been. I don't see much more upside in the SAN share price so may well swap all of these for HSBA over the next couple months.

The upside on SAN is that the divi will not be cut. Nor SAN.B.

Yesterday was writing up OH's divis for the quarter gone, comparing to the same quarter last year, so static. When one looks at the feeble level of divi cover amongst the former sturdies, it's hard to see the way ahead. Not much of a This Way sign about HSBC.

I think banks in general have been slow to cut their branch networks, and of course I don't want my branch to vanish even though I can't recall when last I visited, and all the hooha about 'unfair' overdraft fees hasn't done much for profits. There seems to be a notion, in the UK at least, that the banks are some sort of charity, like the utilities. With interest rates at the current ridiculous level just how exactly are banks supposed to make money?
I hold Lloyss and RBS, but wish I'd stuck to their Prefs.

V8

[moorfield]

The upside on SAN is that the divi will not be cut. Nor SAN.B.

I've tried that argument here before. Do be careful V8, that's dangerous talk.

[mike]

When HSBC declared their dividend and associated timetable back on 18 February, they stated

The dividend will be payable in US dollars, pounds sterling or Hong Kong dollars, or a combination of these currencies, at the forward exchange rates quoted by HSBC Bank plc in London at or about 11.00am on 30 March 2020.

https://www.investegate.co.uk/hsbc-holdings-plc--hsba-/rns/hsbc-holdings-plc---2019-annual-results/202002180700012736D/


And this was re-confirmed on 11 March

Exchange rate determined for payment of dividends in sterling and Hong Kong dollars - 30 March 2020

https://www.investegate.co.uk/hsbc-holdings-plc--hsba-/rns/annual-financial-report---9-of-9/202003111638016530F/


Checking back, every exchange rate has been declared between 12:30 and 13:30 on the day in question for the last two years, so we should have seen that today.

But there was nothing.

I wonder if there will be another entry on the cancelled dividends log at 7:00am tomorrow ? Or perhaps its just a delay in announcing the exchange rate

[emoji]
fingers-crossed
[/emoji]

[Steveam]

I’m expecting the dividend to be cancelled. I expect the same for Lloyds. I hold both. If this happens it will make a significant dent in my income.

Best wishes,

Steve

[Dod101]

It rather looks although they are giving themselves 24 hours to concoct a press release maybe cancelling the upcoming dividend and rearranging the AGM since no members of the public are likely to be present.

If so I will have gone off Mark Tucker in a big way. The way he handled first the sacking of John Flint and then the 9 months or so it took him to confirm Noel Quinn as his replacement was ridiculous and disrespectful in the extreme to Quinn. If they now cancel the big dividend due in two weeks time it will be confirmation of his uselessness. Just as well there cannot be a public AGM if that happens, but let's see.

Dod