Last week, the Macquarie Group Ltd (ASX:MQG) posted its weakest first-half profits in more than six years as the financial services and investment bank navigates the profound impacts of COVID-19.
Macquarie reported its net profit fell 32% to $985 million in the first half of FY21, weighed down by the notable $477 million credit and other impairment charges due to the impact of the pandemic. This is marginally better than the 35% decline the company had forecast in September.
Despite this, the Macquarie share price shrugged off weak earnings to push higher.
Macquarie share price rally The S&P/ASX 200 Index (ASX: XJO) and All Ordinaries Index (ASX: XAO) have hit 9-month highs following record low interest rates of 0.10% and the results of the US election. The bullish sentiment from the general market could continue to fuel a rally for equities, more broadly speaking.
The Macquarie share price rallied almost 2% on the day of its interim results announcement. Since then, its share price has continued to climb and is currently trading for $142 per share, up 4% today alone. This puts it within around 6% of its previous record-all time high of $152.
Broker updates Here’s what big brokers are thinking in light of the results and Macquarie’s share price rally.
Credit Suisse (SIX:CSGN) raised its Macquarie share price target from $107.50 to $128.00 and retains a neutral rating. The investment bank is concerned about the worsening outlook as pandemic impacts continue to be felt in key markets such as Europe.
Morgan Stanley (NYSE:MS) lowered its Macquarie share price target from $152.00 to $148.00 and retains an overweight rating. It anticipates that the first half results may have set the low point of the company’s current earnings downturn. However, it expects the recovery to be slow as the pandemic continues to drag on key markets and segments.
UBS raised its Macquarie share price target from $125.00 to $135.00 and retains a neutral rating. It addressed both the positives and negatives in the half-year results including strong loan growth rates offset by lower margins, cost pressures and performance fees. The investment bank remains cautious but could see some upside to Macquarie’s operating metrics.
The post What big brokers are thinking about the Macquarie (ASX: MQG) share price after its interim results appeared first on Motley Fool Australia.
Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The Motley Fool's purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2020
This Article Was First Published on The Motley Fool
