The Macquarie Group (ASX:MQG) share price rose $1.40 or 1.14 per cent to $124.04 in early Tuesday trading after the investment bank said it continues to expect FY19’s profits to be broadly in line with FY18.
This guidance is in line with the bank’s update from late July.
Over the medium-term, Macquarie said it remains well positioned to deliver superior performance. The bank is seeing the ongoing benefits of continued cost initiatives.
In a presentation at the CLSA Investors’ Forum in Hong Kong, Macquarie said its asset management division continued to perform well in the first quarter of FY19, and in capital markets it has experienced strong trading conditions across most markets.
Looking ahead to the FY19 outlook, while Macquarie expects asset management base fees to be higher, it expects performance fees and investment related income to be down. In banking and financial services, like the big four banks, Macquarie is experiencing margin pressure due to higher costs.
Macquarie shares have returned 44 per cent over the past 12 months, easily out-pacing the 7.5 per cent return from the ASX 200 over the same period.
While Macquarie continues to look a good long-term play, in the shorter-term the company is looking more attractive as a dividend share.
Macquarie shares trade on a dividend yield of 4.3 per cent, franked to 45 per cent, which grosses up to 5.1 per cent.