Why buying this ASX 200 stock could deliver a 30% annual return

Macquarie thinks that investors could get a great return from this stock.

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Key points

  • Pinnacle Investment Management is projected to offer a total return of over 30%, driven by a potential share price increase of 28% and dividend yields of approximately 2.9% in FY 2026.
  • Macquarie supports Pinnacle's strategic investment in Japan's Advantage Partners, which is expected to significantly expand Pinnacle's footprint and drive organic growth.
  • With a reaffirmed outperform rating, Macquarie cites Pinnacle's favourable organic growth trajectory and accretive M&A potential as key factors for its positive outlook.

Pinnacle Investment Management Group Ltd (ASX: PNI) shares could be a top option for Aussie investors right now.

That's the view of analysts at Macquarie Group Ltd (ASX: MQG), which believe the ASX 200 stock could generate big returns over the next 12 months.

What is the broker saying about the ASX 200 stock?

Macquarie was pleased with Pinnacle's performance during the first quarter of FY 2026. It said:

$197.4bn FUM at Sep-25, was +10% vs Jun-25, with Retail $44.4bn, +12%, International $55.7bn, +8%, and Domestic Insto. $97.3bn, +10%. • +$13.3bn Net inflows, comprised +$4.0bn Retail, +$2.9bn International and +$6.4bn Domestic Insto. There was no 'Acquired' FUM in 1Q26.

But the big news was its investment in a new affiliate, Advantage Partners.

It is the largest independent, diversified private markets platform in Japan. The ASX 200 stock has agreed to acquire up to 13% of Advantage Partners over a three-year period. It will start with an initial 5% stake for $92 million and has an option over a further 8% at a similar valuation.

Macquarie appears supportive of the move, highlighting its organic growth potential. It said:

Advantage Partners provides a regional private markets footprint and expands Pinnacle's position in Japan. Advantage Partners has near-term organic growth potential, driven primarily by larger fund raises of JBO and Private Solutions funds, expected to take FUM from ~US$3bn to US $6.5bn+ over the next 12 mths. Advantage Partners also has substantial exposure to performance/carry fees. Deal Terms: PNI will acquire up to 13% over a 3-yr period, via an initial 5% stake for A$92m and an option of a further 8% at similar valuation.

Time to buy

In response to the news, Macquarie has reaffirmed its outperform rating with an improved price target of $26.55 (from $25.33).

Based on its current share price of $20.68, this implies potential upside of 28% for investors over the next 12 months.

But the returns wouldn't stop there. Macquarie is expecting dividend yields of approximately 2.9% in FY 2026, boosting the total potential return beyond 30%.

Commenting on its recommendation, the broker said:

Outperform. PNI has an attractive organic growth outlook and potential to add accretive M&A. Outlook for organic performance is backed by net flows, performance fees, and operating leverage.

Valuation: Our target price of $26.55 (from $25.33 prior) reflects revised earnings forecasts. Catalysts: Markets, performance, and flows. 1H26 result Feb-26.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group and Pinnacle Investment Management Group. The Motley Fool Australia has positions in and has recommended Macquarie Group and Pinnacle Investment Management Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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