The Macquarie Group Ltd (ASX: MQG) share price has been a very strong performer on Tuesday.
In afternoon trade, the investment bank’s shares are up 4% to $201.73.
At one stage today, the Macquarie share price was up as much as 5.5% to $204.88.
Why is the Macquarie share price charging higher?
Investors have been bidding the Macquarie share price higher today following the release of its third quarter operational update.
Although the bank didn’t provide any financials with its update, it advised that it was “a record quarter.”
This was driven by strong performances from its market-facing business. Management advised that the Commodities and Global Markets (CGM) and Macquarie Capital businesses have delivered a combined profit contribution that was up “substantially” on the prior corresponding period. This is also the case financial year to date.
What was the reaction?
This update went down well with the team at Goldman Sachs, which suspects that Macquarie could outperform its expectations in FY 2022.
Goldman commented: “While no specific group guidance has been provided by MQG for FY22, the divisional outlook is incrementally more positive than what was provided at MQG’s 1H22 result in Oct-21, which leaves upside risk to our current forecasts.”
Looking longer term, the broker notes that Macquarie has highlighted that a whopping US$75 trillion of total infrastructure investment will be required globally by 2040.
Goldman appears to believe this bodes well given how “management highlights it was the number one global infrastructure financial advisor in 2021, driven by a tenured senior team, that continues to innovate and push into new markets.”
Is this a buying opportunity?
At present, Goldman has a neutral rating and $199.40 price target on the company’s shares. This is broadly in line with where the Macquarie share price is trading currently.
However, there is a chance that the broker will make some changes to its recommendation and valuation in the coming days once it has update its model to reflect this stronger than expected performance. So, stay tuned for that.
The post Macquarie (ASX:MQG) share price jumps after outperforming expectations and excitement over US$75tn opportunity appeared first on The Motley Fool Australia.
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More reading
- ASX 200 (ASX:XJO) midday update: Macquarie and Suncorp impress
- Macquarie (ASX:MQG) share price on watch following ‘record quarter’
- 5 things to watch on the ASX 200 on Tuesday
- These ASX 200 shares can beat inflation: expert
- Blimey: Macquarie (ASX:MQG) share price in focus on possible £10 billion UK deal
Motley Fool contributor James Mickleboro 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 recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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