Macquarie Group Ltd (ASX: MQG) isn't the first name on many investors' dividend lists when looking for the next income investment. But as a financial stock often nicknamed the ASX's 'fifth bank', it is probably not at the bottom either.
The ASX banks are, of course, well known as some of the most generous and consistent payers of franked dividend income on our stock market.
Let's see if Macquarie's income chops make it worthy of this moniker.
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Macquarie shares: Are the dividends worthy of an ASX bank stock?
Let's start at the top. At the time of writing, Macquarie Group shares are trading at $248.97 each, down about 0.04% for the day thus far. Incidentally, this came after the company hit a new all-time record high of $250.78 earlier this morning.
At the current share price, Macquarie is trading on a trailing dividend yield of 2.81%. That's based on the two most recent dividends Macquarie has paid out. The first of those was the December interim dividend, worth $2.80 per share. The second, the final dividend of $4.20 per share that is due for distribution next month on 2 July. We will count it because Macquarie shares have already traded ex-dividend for the payment.
That 12-month total of $7 per share that Macquarie is set to deliver works out to be worth that 2.81% yield at the current price.
Macquarie's dividends almost never come fully franked, and these payments are no different. Both are partially franked at 35%.
Macquarie's payouts do tend to fluctuate from year to year. To illustrate, Macquarie paid a total of $6.90 per share in dividends in 2025, $6.45 in 2024, $7.05 in 2023, $6.50 in 2022, and $6.07 in 2021.
In some potentially good news, analysts are pencilling in a total payout of $7.40 in 2027.
So Macquarie is arguably a reliable income payer, albeit slightly less than steady.
Foolish Takeaway
The reality is that Macquarie's nature as a diversified financial stock, not just a bank, combined with its international operations, has arguably always made it less attractive as a pure-play income investment than the other ASX banks. Indeed, Macquarie's trailing yield today is well below all four of the major ASX banks. Even Commonwealth Bank of Australia (ASX: CBA).
The fact that Macquarie is at an all-time high today isn't helping matters either. The higher a share price goes, the lower its dividend yield gets.
Macquarie shares, at least in my view, are a great buy for investors looking for growth and a bit of income on the side. As a centrepiece of an income-focused portfolio? Not so much.
