The “Millionaires Factory” has underperformed the “Big Four” so far this year falling 1.6% compared to all of the majors advancing by +8% , or more. MQG did deliver a better 3rd quarter trading update (covered Here) with improving momentum across its markets-facing businesses but it wasn’t enough to get us off the comfortable fence. The stock is trading on the cheaper of history, ~10% below its 5-year average, but it’s not compellingly cheap to MM considering lingering concerns over some private credit exposures compounded by the announcement that Barrenjoey & Magellan are getting together.
Barrenjoey with a bigger balance sheet is a threat to Macquarie, while Macquarie also have significant exposure to private credit — both as a lender using its own balance sheet and as a manager of private credit funds for institutional investors. That exposure comes through several parts of its business and has been growing rapidly, reaching around $29 billion by late 2025, up materially over previous periods.
While private credit is a broad church, and there’s no evidence of stress in its book, plus its diversified model and risk frameworks are very sophisticated, the momentum is against MQG for now on a couple of fronts.
- We can see MQG testing $180 in 2026, with investors likely to remain jittery around private credit across the investment banks through 2026.
MM is neutral towards MQG around $200
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