Top 5 Undervalued Dividend Stocks to Buy Now

3. HSBC Holdings plc (NYSE:HSBC)

Forward P/E Ratio: 10.93

Dividend Yield as of May 17: 4.24% 

HSBC Holdings plc (NYSE:HSBC) is one of the largest banking and financial services institutions in the world, serving millions of customers through its four global businesses.

On May 14, RBC Capital increased its price target on HSBC Holdings plc (NYSE:HSBC) from £1,200 to £1,275, while maintaining a ‘Sector Perform’ rating on the shares. The move comes a few days after JPMorgan also bumped up its price target on the stock by £10, while keeping its ‘Neutral’ rating (read more details here).

The target boosts come despite HSBC Holdings plc (NYSE:HSBC) reporting a pre-tax profit of $9.4 billion for the quarter, falling behind estimates on the back of higher expected credit losses and other impairment charges. However, the bank’s revenue surged by over 5% YoY to $18.6 billion and topped expectations on stronger wealth fees and other income.

HSBC Holdings plc (NYSE:HSBC)’s expected credit losses soared by 44% YoY to $1.3 billion during the quarter, driven primarily by the “fraud-related” exposure to a financial sponsor in the UK and provisions owed to a worsening economic outlook due to the ongoing US-Iran war.

With an impressive annual dividend yield of 4.24%, HSBC Holdings plc (NYSE:HSBC) was also recently included in our list of the 12 Best Blue Chip Dividend Stocks to Buy Now.