Macquarie Group Ltd (ASX: MQG) shares have seen plenty of growth over the years and one fund manager thinks there could be more to come. As we can see on the chart below, the ASX financial share has risen more than 70% in the past five years.
Macquarie shares were caught up in the recent sell-off of the global share market, with the global investment bank's share price down 3% since August 1.
That's not much of a sell-off, considering it's still 10% higher than it was at the start of the year.
However, the fund manager K2 Asset Management has pointed to a number of factors as to why Macquarie shares are an appealing buy today, according to reports by the Australian Financial Review.
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Reasons to be bullish on Macquarie shares
K2's George Boubouras believes the US economy will experience a soft landing rather than a painful recession. Therefore, the fund manager is not expecting significant interest rate cuts in the US.
He's expecting a similar thing in Australia, with only two rate cuts projected for 2025. On potential central bank easing, he said:
Rate cuts don't have to be quick and aggressive. They can come down very slowly or risk core inflation will re-accelerate.
Under this environment, K2 suggests Macquarie shares are a good opportunity, which is why the ASX financial share is one of the fund manager's largest positions.
There are (at least) five reasons why Boubouras and the rest of the investment team like the ASX financial share.
First, compared to global peers, Macquarie has been able to "maintain margins across key areas, whether it's the funds management business or investment banking".
Second, Boubouras believes the global investment bank's "exposure towards the global green energy transition seems well-placed".
Third, K2 likes that Macquarie has grown its business by approximately 7% per annum over the past two decades, which is a solid record of compounding.
The fourth reason that the investment team likes the ASX financial share is that Macquarie generates a significant portion of its earnings in Australia, with more than 10,000 staff in its home country. That's despite the company's international earnings growing substantially faster than the local operations.
The fifth reason to like the business is Macquarie's banking and financial services (BFS) segment, which provides home loans and company loans and has grown significantly in the last decade.
Macquarie share price snapshot
In the past year, the Macquarie share price has risen 16%, compared to a rise of 7% for the ASX 200.
