This FTSE 100 share has crashed 50%, but I’d keep buying it today!

first_img I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has recommended HSBC Holdings. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. This FTSE 100 share has crashed 50%, but I’d keep buying it today! Cliff D’Arcy | Monday, 3rd August, 2020 | More on: HSBA I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Image source: Getty Images. This isn’t an easy time to be a stock-picker, especially one focused on finding value within the FTSE 100 index. Thanks to Covid-19, there are several sectors (airlines, travel & leisure, etc) that are practically uninvestable right now.Hence, my search for hidden value within the FTSE 100 has tended to concentrate on a few key sectors. I’ve been bargain-hunting mostly within the oil & gas, mining, and banking sectors. And yet prices keep falling, pushing these sectors further into bombed-out territory.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…This FTSE 100 share is bombed-outFor example, take FTSE 100 behemoth HSBC Holdings (LSE: HSBA), whose shares keep dropping every time I rate them as a value buy. They’re down nearly 50% in a year.Exactly a week ago, I claimed that HSBC shares were ‘as cheap as chips’ at 354.3p. Today, after unveiling half-year results, the FTSE 100 bank’s shares hover around 326p. That’s a further fall of 8% in a week, so now they must be even cheaper than chips, perhaps?HSBC faces huge headwindsAs Europe’s largest bank and a leading lender in Asia, HSBC is suffering a perfect storm right now, thanks to these five factors:Being in the firing line of the emerging US-China ‘Cold War’.Concerns over a no-deal Brexit at the end of 2020.The impact of a second wave or rolling Covid-19 waves on lenders.The shape and pace of any post-Covid-19 economic recovery.Falling interest income due to zero or negative interest rates.In short, now is not a great time to be a lender, never mind a FTSE 100 mega-bank with close to $3trn in assets.Another FTSE 100 bank takes a beatingAs for HSBC’s latest results, they make for grim reading, with hugely increased provisions against bad loans almost wiping out profits.In the second quarter, HSBC set aside $3.8bn in loan-loss provisions, roughly $1bn more than analysts estimated. This takes the FTSE 100 firm’s loss provisions to $6.9bn over six months. For 2020 as a whole, total provisions could be as high as $13bn or as low as $8bn, the bank reckons.For the half-year, HSBC’s reported revenues dropped by 8.9% year-on-year to $26.7bn. Reported profit before tax crashed by two-thirds (65.2%) to $4.3bn. Worse still, earnings per share at HSBC collapsed by three-quarters (76.2%) to just $0.10 (from $0.42). Ouch.Hence, the FTSE 100 firm will accelerate its cost-cutting programme, including bringing forward the 35,000 job cuts already flagged up.This FTSE 100 share is cheapToday, HSBC shares dropped another 5% to 326p, their lowest since the darkest days of 2009. Before the global financial crisis, the FTSE 100 bank’s share price last plumbed these depths in 1996 – almost a quarter-century ago. As I said, they’ve fallen sharply in just a year and for the record, they’re actually down 49.6% over the past 12 months. So HSBC’s market value has halved, blowing up £70bn of shareholders’ capital in a year.As a value investor, you have to ‘buy boldly when there is blood in the streets’. Things look bleak for this FTSE 100 share today, but it will bounce back. That’s why I would grit my teeth and fill my boots with HSBC shares today! See all posts by Cliff D’Arcycenter_img Our 6 ‘Best Buys Now’ Shares Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Enter Your Email Address Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! “This Stock Could Be Like Buying Amazon in 1997” Simply click below to discover how you can take advantage of this.last_img

Leave a Reply

Your email address will not be published. Required fields are marked *