Is the Macquarie Group Ltd (ASX: MQG) share price a buy?
Some people think yes, some people think no. Over the past month the Macquarie share price has rallied 7.1%, so it's not as much as a buy as it was before.
I have always said that I prefer Macquarie as a long-term investment compared to Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB).
Macquarie operates in a variety of financial sectors across the world, compared to the big four ASX banks that focus on lending to Australians and Kiwis.
I believe it is Macquarie's diversified financial approach that has allowed it to continue to grow profit each year. In the recent half-year result Macquarie reported its profit was up 5% to the year before and the dividend had been increased by 5%.
I've been impressed by Macquarie's shift since the GFC to more defensive earnings such as infrastructure management – Macquarie is the world's largest infrastructure manager.
Is Macquarie a buy? Some investors believe there's now too much optimism built into Macquarie's share price.
Trading at 14x FY19's estimated earnings, it's not exactly priced for stellar growth. Analysts are only expecting a little bit of growth each year between now and FY21, which is better than nothing. Even so, recent market volatility could cause a problem for Macquarie's short-term earnings, which can happen for an investment bank.
Out of all the shares in the ASX20, at the current prices I would be inclined to go for Macquarie. However, I'd go in expecting some volatility along the way as a global financial business.
