MQG -4.37%: the investment bank hosted its AGM today which came with a soft 1Q update weighing on shares. The company said both market-facing and annuity-style sides of the business had difficult starts to the year with profit substantially down. The group relies on activity to generate earnings and lower capital market deal flow & reduced commodity volatility weighing on the market sides of the business. The annuity side has seen higher earnings from the banking arm thanks to growth in the loan book, however, this has been more than offset by lower asset management returns, particularly in green investment. Consensus had priced in a 7% drop in earnings for the first half, though the commentary suggests the company is tracking well below that. The company has consistently under promised and over delivered, so we have confidence in a swift turnaround for earnings here – although clearly some external factors are having an influence.
MM is long and bullish MQG
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