Finance

The Aspects of Financial Life in the UK

Barclays has over $244 billion in assets under management and ‘Barclays Global investors’ manage 65 of the world’s top 100 largest pension plans. Barclays has spread its wings in 37 countries outside the United Kingdom and a strong presence in Africa through acquisitions. Barclays also provides a hedge against falling US dollar which is now at a 14 year low against the pound sterling. ‘Barclays capital’ handles foreign exchange, derivatives, and fixed income business.HSBC holdings have emerged as the single largest bank in the world operating with 9800 branches in nearly 80 countries. The group has identified itself as a giant in providing consumer and commercial banking services, credit cards, asset management, private banking, securities trading, insurance, and leasing. The operations of the bank in the United States include HSBC USA with the purchase in the year 2003 of the consumer lender ‘Household International’ now known as ‘HSBC Finance’.From the above data, consideration of earnings per share, Price/Earnings ratio, dividend yield, Beta risk, and movement of individual share prices, which are the major criteria apart from the others, would provide a clear indication about the stocks in which the investment should be made.By ‘earnings per share’ (EPS) we mean the consensus analysts’ current fiscal year as well as the next fiscal year earnings per share. In the present analysis, the EPS of HSBC is far in excess than that of Barclays both for the current fiscal and the next fiscal. It is 7.68 and 8.18 respectively in the case of HSBC as against 5.02 and 5.52 for Barclays. The stocks of HSBC qualify for investment on this score than that of Barclays.The Price to Earnings (P/E) Ratio is a company Last Closing Price divided by the current year estimate of earnings per share (EPS). To consider an investment-worthy, the price to earnings should be at a lower rate. In numerical terms, the P/E ratio forBarclays is 11.37 as compared to 11.84 of HSBC.

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