Macquarie surpasses Westpac to become Australia’s third largest bank

Image Source: © Timonschneider | Megapixl.com

Highlights

  • Macquarie Group's market capitalisation has soared to AU$ 80.391 billion.
  • In the last one year, MQG share price has rallied over 50%.
  • Macquarie's net profit after tax rose 107% year-on-year to AU$A2,043 million for the half year ended 30 September 2021 (1H2022).

Macquarie Group (ASX:MQG) is now Australia's third-biggest bank, surpassing Westpac (ASX:WBC). In November last year, Macquarie had piped Australia & New Zealand Banking Group Ltd (ASX:ANZ) to become the fourth-largest bank in Australia.

Macquarie Group's market capitalisation has soared to AU$ 80.391 billion, higher than the market value of Westpac and ANZ, which is now at (11:16 AEDT) AU$ 79.607 billion and AU$ 79.52 billion respectively.

National Bank of Australia (ASX:NAB), which commands a markets value of AU$96.447 billion, is the second-biggest lender in Australia while Commonwealth Bank of Australia (ASX:CBA) is the bellwether with a market capitalisation of AU$173.79 billion.

ALSO READ: From Macquarie to AMP: Why these shares are on buyers’ radar today

Macquarie 1H2022 profit more than doubled

Macquarie achieved this feat after its share price gained 3.30% in the last one month. At the time of writing this article MQG shares were up 0.585% at AU$ 209.61. In the last one year, MQG share price has rallied over 50%. Analysts say Macquarie's market capitalisation growth is reflective of the lender's earnings growth and track record of superior execution. 

Macquarie's net profit after tax rose 107% year-on-year to AU$A2,043 million for the half year ended 30 September 2021 (1H2022), compared to the year ago figure. Meanwhile, the lender raised AU$2.8 billion in 2021 to fund acquisition and pursue other growth opportunities.

Image Source:© Esmehelit | Megapixl.com

Macquarie’s assets under management as on 30 September 2021 stood at AU$737.0 billion, up 31 per cent from AU$563.5 billion as on 31 March 2021, primarily due to the acquisition of Waddell & Reed.

ALSO READ: Macquarie (ASX:MQG) in Big Four league as market cap swells

While Macquarie witnessed strong growth in its mortgage volumes, ANZ and Westpac continue to struggle with mortgage growth. The street has rerated the stock's earnings multiple to reflect its mortgage growth and the group's ability to monetise some of the investment opportunities from decarbonisation trends globally.

At the current market price, Macqarie share are now valued at 19.47x its earnings, which is over 20% higher than its long-term average PE of around 16x. Market analysts are keeping an eye on Macquarie’s change in business model and its ability to deliver superior earnings growth in the near future. 

ALSO READ: How Macquarie (ASX:MQG) managed to double its first half profit


 


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