RBC Capital Markets has initiated coverage of Macquarie Group Ltd (ASX: MQG) shares, with a bullish price target, saying the financial giant is “reinventing itself”.

Macquarie tipped for steady growth

The broker has issued a new research note on Macquarie, and said they expected the company to deliver mid-to-high single-digit earnings growth into FY29, “underpinned by operating leverage across asset management and personal banking”.

RBC said on the outlook for Macquarie:

Our ~6.5% FY26-29 earnings compound annual growth rate (CAGR) sees us ahead of consensus. What’s more, we think earnings risks are skewed to the upside given ongoing volatility in commodity markets, and potential for large asset sales. Macquarie is reinventing itself – pivoting towards recurring private markets asset management and domestic banking growth, while building out global energy trading and capital markets capabilities that provide earnings upside. The shift is away from balance sheet-intensive asset development and towards capital-light private credit and funds management.

RBC said the recent changes at Macquarie had been substantial, with the company refocusing on higher return on equity divisions and prioritising recurring revenue growth.

The commodities and global markets division would account for 39% of FY27 profit, RBC said, with the broker expecting about 8% commodity revenue CAGR from FY26 to FY29.

RBC said:

Near-term potential catalysts include the historically low EU gas storage levels and Qatar LNG outages, and longer-term potential catalysts include 1.5 million tonnes per annum of LNG offtake agreements (Texas LNG and AMIGO LNG) coming online from FY28E and data centre energy demand across constrained US power grids. We estimate every additional 10% commodity revenue growth adds ~3.5% to group FY27 earnings.

Macquarie Asset Management, which will account for about 28% of FY27 profit, “has lagged other divisions”, but is pivoting to private credit to unlock growth, RBC said.

Meanwhile, banking and financial services had been the most consistent compounder in the group, RBC said.

They added:

We forecast BFS divisional profit contribution to grow 15% in FY27E and then ease to 8-10% in FY28-29E as Australian mortgage system growth slows. However, given options to further reduce it cost-to-income ratio (54% in FY26, potentially heading 40% over time), we think BFS earnings growth may be able to surprise on the upside. MQG holds just 7.1% of Australian housing loans and 6.5% of deposits.

Macquarie shares looking like good value

RBC said the release of Macquarie’s first-half results on November 6 should be a catalyst for the stock, “as we see upside risks to consensus forecasts”.

RBC has a price target of $300 on Macquarie shares, compared with $244.60 at the time of writing.

Macquarie is valued at $91.89 billion.

The post How high could Macquarie shares go? RBC Capital Markets has its say appeared first on The Motley Fool Australia.

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Motley Fool contributor Cameron England has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group. The Motley Fool Australia 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.

It hasn’t been a great year for The Lottery Corp Ltd (ASX: TLC) shareholders.

Its shares finished Monday down 0.62% at $4.78, leaving them just above their 52-week low of $4.75.

The stock has now fallen around 18% over the past 12 months and is down more than 7% in 2026.

Yes, that might have some investors wondering whether the recent weakness has created a buying opportunity.

After all, the company owns some of Australia’s best-known lottery brands and currently offers a fully franked dividend yield of around 3.5%.

But despite the lower share price, I won’t be buying.

Here’s why.

Higher rates are a concern

My biggest concern is what happens to consumer spending over the next 12 months.

The Reserve Bank of Australia (RBA) has already lifted interest rates 3 times this year, taking the cash rate to 4.35%.

And another increase looks likely today, with all 29 economists surveyed by Bloomberg expecting a 25-basis-point hike to 4.60%.

That’s not great news for households already dealing with higher mortgage repayments and rising living costs.

And this is where I see a potential problem for the company.

Lottery tickets are ultimately a discretionary purchase.

If households have less money after paying their mortgage and other bills, I think spending on lottery tickets could come under pressure.

With rates potentially staying higher into 2027, that’s a risk I’m not willing to ignore.

FY26 wasn’t exactly exciting

The company’s latest results haven’t given me much reason to rush in either.

FY26 revenue fell 2.7% to $3.58 billion, while underlying net profit after tax (NPAT) dropped 6.3% to $342.5 million.

Statutory net profit fell even further, declining 22.1% to $284.6 million.

To be fair, weak jackpot activity played a big part in the softer result.

There were no $100 million Powerball jackpots during the year, compared with 4 in FY25, while Oz Lotto had no $50 million jackpots.

Base games performed better, with turnover increasing 5.6%, while Keno revenue climbed 3% to $364.3 million.

But looking ahead, there are still a few things that concern me.

Lottery Corp expects operating expenses of between $305 million and $315 million in FY27, up from $296 million last year.

It also has a $1.145 billion payment coming up for its new Victorian lottery licence, which could put further pressure on the balance sheet.

None of this is enough to get me excited about buying the shares just yet.

Would I buy?

At $4.78, Lottery Corp shares are certainly more attractive than they were a year ago.

And there are still plenty of things to like about the business.

It owns some of Australia’s biggest lottery brands, generates strong cash flow, and maintained its fully franked 16.5-cent annual dividend.

But I don’t think the current economic environment is particularly favourable.

With earnings already moving backwards and household spending facing more pressure, I think there are better opportunities elsewhere.

For me, this is one ASX dividend share I’d stay away from for now.

The post This ASX dividend share is near a 52-week low. Would I buy? appeared first on The Motley Fool Australia.

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

BHP Group Ltd (ASX: BHP) shares tumbled lower in September.

The mining giant’s shares are $59.80 at the time of writing. That’s around an 11% decline over the past month, but it is still roughly 31% higher year-to-date.

For context, the S&P/ASX 200 Index (ASX: XJO) is down around 5% over the past month and 1% higher year-to-date, at the time of writing.

What happened to BHP shares in September?

BHP was pushed into the spotlight in early September after news that China’s biggest steelmaker, China Baowu Steel Group, is reportedly considering buying into one of BHP’s largest iron ore mines. 

Australia’s Federal opposition has already objected. The Coalition has said that Labor must not allow foreign entities to buy one of Western Australia’s top iron ore mines.

Just last week, mining activities at BHP’s Escondida copper mine in Chile were suspended after a fatal accident. There is no indication when production might resume. 

Under Chilean mining regulations, operations cannot restart following a fatal accident until safety inspectors have confirmed that conditions are safe. 

The halt raised concerns about the miner’s output, and also raised safety concerns, which has contributed to the latest share price slide.

And all this has happened amid a broad market downturn, driven by rising oil prices and interest rate concerns, which have also dampened investor sentiment. 

So, what’s ahead for BHP shares in October? 

Is the ASX mining stock primed for a rebound? Or are there more headwinds coming?

Here’s what the experts think.

Broker forecasts for BHP shares

It looks like the experts are reserved about the outlook for the miner’s shares over the next 12 months.

Market Index data shows that most analysts rate BHP shares as a hold. The $61 average target price suggests a hold rating for BHP shares, with about 2% upside at the time of writing.

TradingView data shows something similar. Again, the majority have a hold rating on the shares. The average target price is a little higher, at $62.13 a piece, which implies a potential 4% upside at the time of writing.

Morgan Stanley has a buy rating and a $68 target price on BHP shares.

Red Leaf Securities has a hold rating on the mining shares. The broker warns that a softer global growth outlook and uncertainty surrounding Chinese commodity demand limits the case for aggressively buying the stock right now.

Dylan Evans from Catapult Wealth also has a hold rating on the shares. He said that the miner’s full-year results were impressive. But added that future earnings will be influenced by the copper price.

The post Should I buy BHP shares in October? appeared first on The Motley Fool Australia.

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Motley Fool contributor Samantha Menzies has positions in BHP Group. 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 BHP Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.