Strategic Manoeuvring Takes Macquarie’s Share Price to a New High

What happened to Macquarie share price?

At time of writing, Macquarie Group Limited’s [ASX:MQG] shares are trading at just over $125.00, breaking their 52-week high of $125.290, which was hit only yesterday.

As the largest Australian investment bank, and the top ranked merger and acquisitions advisor in the country, Macquarie Group rely on well-played market moves to secure their profits.

As of 31 March 2018, the company has $121.3 billion in total assets, with an equity of $18.2 billion.

They currently hold a 49-year record of unbroken profitability. Needless to say, their market moves have been beneficial.

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The recent plays by Macquarie

In their FY18 media release, CEO Nicholas Moore claimed:

Macquarie remains well positioned to deliver superior performance in the medium term due to our deep expertise in major markets, strength in diversity and ability to adapt the portfolio mix to changing market conditions, ongoing benefits of continued cost initiatives, a strong and conservative balance sheet and a proven risk management framework and culture.’

There’s a lot of evidence showing these aren’t just empty claims.

Last week there were multiple ASX announcements showing the companies that Macquarie had recently become a substantial holder in.

These include the Monash Absolute Investment company [ASX:MA1], toll road developer Atlas Arteria [ASX:ALX], and of course, Shriro Holdings [ASX:SHM] — the leading manufacturer and distributor of consumer electronics in Australia and New Zealand.

Shriro shares are up 3% today…clearly Macquarie have thought out their game plan.

And it’s not just about putting money into companies. Macquarie is also getting rid of the weak links. For instance, they are ceasing to be a substantial holder of iSelect Limited [ASX:ISU] — whose shares have continued to follow a downward slope.

That’s a good enough reason for Macquarie to say goodbye.

Another Macquarie interest is The Data Exchange Network [ASX:DXN], known for their innovative and up-to-date data-centre solutions. Their shares are currently up 2%, proving they are a wise investment. It’s perhaps also a way of Macquarie illustrating their ambition to adopt upcoming technologies.

But there’s other things that show this as well…

What’s next for Macquarie?

On 18 June, it was announced that Macquarie hired former Tesla Inc [NASDAQ:TSLA] executive Greg Callman. This was done to enhance Macquarie’s push into renewable energy projects, which are growing to be more commercially competitive against fossil fuels.

This new addition to the team, along with their FY18 investment of $9.5 billion into the renewable energy sector, shows Macquarie are recognising what Tesla Founder Elon Musk calls ‘the biggest problem we need to solve on Earth in this century’.

This big bet on a global trend could mean hefty benefits for Macquarie and their investors. But only time will tell if all continues to go in their favour.



For Money Morning

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Ryan Clarkson-Ledward is an Editor at Money Morning.

Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects.

Ryan is also the Editor of Australian Small-Cap Investigator, a stock tipping newsletter that hunts down promising small-cap stocks by dissecting the latest events affecting the world.

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