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HKEX (SEHK:388) Stock Can Record Profit Justify Its Premium P E

Simply Wall St · 1d ago

Hong Kong Exchanges and Clearing stock closed at HK$417.8 after a steady run in recent weeks, yet today’s move barely hints at how strong this earnings print looks on a multi year view. The headline is simple: HKEX just delivered record first half revenue of HK$16.7b and profit after tax of HK$10.6b, with earnings per share at HK$8.36.

For a market operator built on trading velocity rather than hardware or factories, those records matter. They come at a time when the stock already trades on a rich P/E multiple. The question now is how long this earnings strength can support that premium.

Impressed by Hong Kong Exchanges and Clearing posting record revenue and profit but wondering if that rich P/E leaves you exposed to valuation risk? Balance quality with price by scanning our 277 high quality undervalued stocks.

Q2 2026 Earnings Summary

  • Total Revenue (Q2 2026 vs Q2 2025): HK$8,416m vs. HK$7,080m (+18.9%)
  • Net Income (Excl. Extra Items) (Q2 2026 vs Q2 2025): HK$5,380m vs. HK$4,442m (+21.1%)
  • Basic EPS (Q2 2026 vs Q2 2025): HK$4.26 vs. HK$3.51 (+21.4%)
  • Net Profit Margin (Trailing 12 Months vs Prior Year): 62.9% vs. 60.3% (margin higher year on year)

If you are tired of scrolling through dense earnings tables and rows of figures for Hong Kong Exchanges and Clearing, you can see the full visual picture of the stock with a clear view of its valuation in our company report for Hong Kong Exchanges and Clearing.

SEHK:388 Trailing 12-Month Revenue & Expenses Breakdown as at Aug 2026
SEHK:388 Trailing 12-Month Revenue & Expenses Breakdown as at Aug 2026

HKEX Growth Story Meets Key Volume And Product Milestones

The bullish story around Hong Kong Exchanges and Clearing is that a broader multi asset platform and deeper China access will shift the business away from simple equity turnover. The latest half year numbers show that thesis starting to line up with reality. Record headline average daily turnover of HK$283b, together with record levels in Stock Connect, derivatives and London Metal Exchange contracts, points to both of the company’s claimed growth engines working at the same time.

Several of the specific milestones bulls have been watching are now visible in the results. Exchange traded products have risen to 17% of headline turnover, compared with about 5% in 2021, which supports the push into ETFs and other listed products. The launch of 5 year China Government Bond futures adds a tangible building block to the fixed income and currencies franchise and fits the goal of making Hong Kong the default offshore gateway to China’s bond market.

Compare Hong Kong Exchanges and Clearing's record turnover, product milestones and multi asset push with what institutional analysts are actually pricing in. See the consensus price target analysis for Hong Kong Exchanges and Clearing

HKEX Bears Still Waiting For Structural Cracks

The bearish story around Hong Kong Exchanges and Clearing is that structural risks in cross border flows and listings will eventually cap revenue growth and pressure earnings quality. This half year does not really give that argument the clear validation it needs. Record average daily turnover across cash, derivatives, Stock Connect and LME volumes directly counters fears of shrinking secondary activity, and Hong Kong ranking #2 globally for IPOs challenges the idea that issuers are already turning away in size.

Where bears do find some foothold is in mix and sustainability. Net investment income fell as margin fund returns softened and rebates increased, which supports concerns about more volatile, rate sensitive income streams. Operating expenses also rose faster than revenue, which fits the risk of margin pressure as HKEX funds new products and technology. Those are important, but they are execution issues rather than clear structural volume erosion so far.

After rising expenses and softer margin income, are these just surface issues or early signs of deeper fragility? Review our risk analysis for Hong Kong Exchanges and Clearing which shows 1 important warning sign.

Stay Ahead With Simply Wall St

If Hong Kong Exchanges and Clearing’s record revenue, profit and turnover have caught your attention, register for free with Simply Wall St and add it to a Watchlist to track price against fair value and watch for a better entry point. Once you own the stock, use the Portfolio Command Center to cut through noise and keep on top of only the most important developments across your holdings. For a longer term view, tap into crowd opinion and different angles on Hong Kong Exchanges and Clearing through the Community. By spotting potential catalysts and risks early, you give yourself a better shot at staying ahead of the market.

Seeking Fresh Alternatives Beyond HKEX

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.