Invast says buy Macquarie Group Limited
This week Money asks Invast for a hot stock pick - Macquarie Group Limited (ASX:MQG)
Key statistics:
15/03/16 closing share price: $67.86
52 week high: $86.72 52 week Low: $58.28 Most recent dividend: $3.60 (Int + final) Annual dividend yield: 5.23% Franking: 40%
Macquarie Group has been underperforming the broader ASX 200 index significantly in 2016. At its low of $58.26 on February 12, MQG was down just short of 30% compared with the ASX 200 decline of around 11%. Macquarie is currently down around 19% ($66.95) compared to 2.5% for the index. We see this turning around in months to come and for Macquarie continuing to rally into its earnings announcement scheduled for the May 6.
The underperformance was due partly to a lacklustre Q4 earnings and profit forecast cuts for its commodity and financial markets business. The recovery in energy and metal prices and the overall market should provide a boost to this business and we are looking for a better overall performance to year end than the market currently has priced in.
On a technical level, the short run downtrend which has been in place since early January has been broken and the recent break about $65.50 is the start of a new uptrend.
Obviously MQG will be partially reliant on the performance of ASX 200 as a whole, but we feel that after significant underperformance in the start of the year, it will strongly outperform the index to years end.
Invast Conviction call: Buy Time frame: 12 Months
Disclaimer: The information contained in this document is of a general nature only, and does not constitute any recommendation to trade any stock or CFD. You are strongly recommended to seek professional advice before opening an account with us. Trading in FX and derivatives can be risky and you may incur a loss that is far greater than the amount you invested. Please read our Risk Disclosure, Financial Services Guide, Product Disclosure Statement, and FX & CFD Terms & Conditions.
Get stories like this in our newsletters.
