Motley Fool Australia

Macquarie’s shares hit $50

It’s taken three years to get back there but Macquarie Group’s (ASX: MQG) share price has again broken through the $50 mark.

For shareholders it’s been somewhat of a rollercoaster ride over the past decade. Back in 2004 the share price was trading below $40 before going on a tear towards $100 in mid-2007 prior to the global financial crisis (GFC) arriving. Then in the aftermath of the GFC, shareholders held on for dear life as the stock plunged all the way down to the mid-teens as short-sellers lined up to bet on the demise of the investment bank.

The rally over the past year in Macquarie’s share price will certainly have pleasd shareholders, however the firm’s performance compared with both the S&P/ASX 200 Index (Index: ^AXJO) (ASX: XJO) and peers over the past 10 years show that shareholders are still relatively worse off.

As the chart highlights, over the past decade the S&P/ASX 200 Index is up 63.4%; in comparison Macquarie’s share price has underperformed, increasing by 54.35%. Meanwhile Commonwealth Bank’s (ASX: CBA) shares are up a phenomenal 164.7% and Westpac Bank’s (ASX: WBC) shares have risen a stellar 101.3%.

mac

Source: Google Finance

Foolish takeaway

Of course historical share price performance does not tell investors too much about the potential future performance. A number of savvy investors believe that there is scope for Macquarie to significantly grow its earnings from current levels, which could lead to the investment bank outperforming going forward.

Looking for a stock which could outperform? Discover The Motley Fool’s favourite income idea for 2013-2014 in our brand-new, FREE research report, including a full investment analysis! Simply click here for your FREE copy of “The Motley Fool’s Top Dividend Stock for 2013-2014.”

More reading


Motley Fool contributor Tim McArthur owns shares in Macquarie Group.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

*Returns as of June 30th

Related Articles…