5 reasons Macquarie shares could be a great investment today

An older woman high fives an older man with big smiles after seeing good news on their laptop regarding their ASX tech sharesAn older woman high fives an older man with big smiles after seeing good news on their laptop regarding their ASX tech shares

Macquarie Group Ltd (ASX: MQG) shares have had a good run in 2023.

The diversified S&P/ASX 200 Index (ASX: XJO) financial stock is up 9.5% year to date, despite coming under selling pressure in May. That handily outpaces the 6.0% gains posted by the ASX 200 over this same period.

And there may well be more outperformance to come.

Here are five good reasons why Macquarie shares could still be a great investment today.

Five reasons the ASX 200 financial share could be one to buy today

Fairmont Equities managing director Michael Gable has a buy rating on Macquarie shares.

According to Gable (courtesy of The Bull), “Share price weakness in March brought the stock back to a strong level of support.”

Gable pointed to the fallout from the banking crisis in the United States and Europe following the collapse of Silicon Valley Bank as driving that weakness. But Fairmont Equity believes Aussie investors “over-reacted to overseas events”.

“Consequently, we believe MQG can be considered a buying opportunity for a company with a strong track record of performance,” Gable said.

Which gives us our first two reasons why Macquarie shares could be a great investment today:

One, the current share price weakness looks to be driven by investor overreaction to the international banking turmoil.

And two, the company’s strong performance track record.

Anthony Paterno senior investment adviser at Ord Minnett, has a hold rating on Macquarie shares.

However, Paterno sounded some bullish notes on the ASX 200 financial stock.

“The commodities and global markets division, a key driver of earnings growth in recent years, is again exceeding our expectations,” Paterno said (quoted by The Bull).

“Management continues to invest in technology, and, with excess surplus capital, is well placed to continue taking market share,” he added.

Which gives us reasons three and four why Macquarie could be a great investment today:

Three, one of its key earnings growth drivers is exceeding expectations.

And four, the company is well situated to increase its market share.

To finish off that list I’ll add one of my own reasons why I think Macquarie shares could be a great investment right now.

Reason number five, the company can provide a handy passive income stream, with a lengthy history of making two annual dividend payments.

At the current share price, Macquarie trades on a partly franked trailing dividend yield of 3.6%.

How have Macquarie shares been tracking longer-term?

As you can see in the chart below, Macquarie shares have slipped 12% over the past full year. Investors who bought shares five years ago will be sitting on gains of 72%.

These figures don’t include the company’s dividend payouts.

The post 5 reasons Macquarie shares could be a great investment today appeared first on The Motley Fool Australia.

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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Macquarie Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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