American Express vs HSBC Which Is Stronger?

American Express and HSBC are well-known multinational financial companies with stocks trading on the stock market. American Express is a leading provider of credit cards, travel services, and insurance products. HSBC, on the other hand, is a global banking and financial services organization. Both companies have a strong presence in the financial sector, but they have distinct business models and operational strategies. Investors interested in these stocks should carefully analyze their financial performance, market competitiveness, and growth potential.

American Express or HSBC?

When comparing American Express and HSBC, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between American Express and HSBC.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. American Express has a dividend yield of 0.89%, while HSBC has a dividend yield of 8.5%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. American Express reports a 5-year dividend growth of 10.01% year and a payout ratio of 19.64%. On the other hand, HSBC reports a 5-year dividend growth of 0.62% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with American Express P/E ratio at 21.62 and HSBC's P/E ratio at 7.39. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. American Express P/B ratio is 7.20 while HSBC's P/B ratio is 0.90.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, American Express has seen a 5-year revenue growth of 0.74%, while HSBC's is -0.10%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with American Express's ROE at 34.09% and HSBC's ROE at 12.87%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $296.78 for American Express and $47.95 for HSBC. Over the past year, American Express's prices ranged from $167.77 to $307.82, with a yearly change of 83.48%. HSBC's prices fluctuated between $36.93 and $48.45, with a yearly change of 31.19%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.