Macquarie Sticks With Forecast of Slight Profit Drop This Year

(Bloomberg) -- Macquarie Group Ltd. still expects earnings growth to stall this year, maintaining its forecast that profit will be “slightly down” on last year’s record.

• Trading conditions were “satisfactory” in the third quarter, Macquarie said in a trading update Tuesday.

Key Insights

• The lack of an upgrade to its outlook risks disappointing investors as the Sydney-based investment bank has a track record of raising forecasts throughout the year. Analysts though have warned it will be tougher to deliver an earnings beat, particularly as last year’s results benefited from some big asset sales.
• Profit from asset management and banking businesses rose in the first nine months of the year, while earnings at its market-facing businesses declined.
• In a sign of how increased competition for assets is making good deals harder to find, Macquarie’s infrastructure arm has A$21.1 billion ($14.1 billion) of equity ready to deploy.
• Macquarie shares have hit fresh highs this year as the world’s largest infrastructure manager and green energy specialist attracts investors searching for growth in a low-yield environment.

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