After the hefty sell-down of Macquarie Group (MQG) shares yesterday, brokers are now encouraging investors to buy stock in the investment bank.
Macquarie group fell by 9% yesterday after it announced the impending retirement of revered chief executive Allan Moss.
Mr Moss will be replaced in May by head of Macquarie Capital, Nicholas Moore.
Following the news, Macquarie Bank dropped by $6.06 to close at $61.10 Wednesday, before opening to rally again on Thursday.
"The departure of Moss and Moore's ascension in no way changes the strategy of intellectual horsepower that has fuelled Macquarie's meteoric rise to the world leader in infrastructure banking," JP Morgan banking analyst Brian Johnson was quoted by the Sydney Morning Herald.
JP Morgan has a bullish, and some might say optimistic price target on the stock of $104.03.
On Wednesday night, JP Morgan rated Macquarie Group "Overweight", meanwhile Merrill Lynch, upgraded Macquarie to a "Buy" and Credit Suisse sustained its rating of "Outperform".
Goldman Sachs was more conservative, rating Macquarie as a "Hold".
At 2:15PM AEST, the stock was trading up by 1.37% at $61.94, but it had risen as high as $62.75 during the morning.
Merrill Lynch analysts said that while Macquarie was facing a range of headwinds, such as declining property fund values and difficult funding costs and conditions, its leverage to Asia and unlisted funds still appears set to drive future growth.
"The market (Wednesday) placed a high value on Allan Moss but MQG will remain on its growth path," Merrill analysts were quoted as saying.
JBWere analysts on the other hand were more conservative in their approach to Macquarie's prospects for the 2009 financial year. The SMH says they recommended the stock as a "hold" with the view that it was still too early to aggressively buy shares in the bank given that the FY09 earnings risks remain on the downside.
Shares in Macquarie eased off from the gains earlier in the day but still closed up by 1.31% or 80 cents to finish at $61.90.
