Zacks Investment Research downgraded shares of HSBC Holdings plc – ADR (HSBC) from NEUTRAL to UNDERPERFORM on April 14, 2014, with a target price of $47.00.
We are downgrading our recommendation on HSBC to Underperform due to persistent pressure on its top line. However, the company's overall performance in 2013 was impressive, driven by lower operating expenses and a marginal rise in revenues. Capital and profitability ratios improved as well. We believe that restructuring efforts, cost saving initiatives, diversified revenue sources and a strong capital position will continue to aid bottom-line growth. Nevertheless, sluggish revenue growth in its mature markets, a still weak European economy, lower loan demand, higher litigation costs and stringent regulations remain major near-term concerns.
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