Macquarie Group is a sentiment stock
08/12/15 closing share price: $82.41 52 week high: $86.720 Most recent dividend: 1.6000 Annual dividend yield: 4.37% Franking: 40%
There's a sense of optimism building in the Australian economy. Consumer sentiment has surprised on the upside, jobs have outperformed, the Reserve Bank seems comfortable, we don't have an inflation issue and rates are a record low levels.
Macquarie Group (ASX: MQG) seems to innovating into a tech-focused financial stock.
It reported solid earnings for the first quarter of this year and return on equity is now above 15%. Should the market lift into Christmas, Macquarie is well placed to lead.
We see it as a buy but with a stop loss at $80 - just in case we have an unexpected global event that reverses this sentiment quickly.
Otherwise, it could continue its upward trend into the high $80s. That represents an attractive risk-to-reward proposition.