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09 April 2021 | Buy

BUY | Macquarie Group Limited


Diversification to deliver impressive profit growth and income

Macquarie Group Limited (ASX:MQG)

Macquarie Group Limited (MQG) is Australia’s largest investment bank and a global leader in infrastructure development investment.

Its diversified operations (both geographically and by business type) offer some hedge against current conditions, with trading activities likely buoyed by volatility and potential for gains as rising asset values will, in time, assist asset management and recycling profitability.

Clearly, some areas of MQG’s operations will also be under pressure, however, we are attracted to the group’s conservative balance sheet (over $5bn in excess capital), and recent execution suggests it can maintain strong performance through the cycle. The recent profit upgrade will now see profits up 5-10% this year from previous guidance of slightly down.

The diversification of the MQG business has come to the fore and will help deliver impressive profit growth and income outcome when they report in May.

We see the group well-positioned to capitalise on opportunities on the other side of COVID-19. 



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