Macquarie's Earnings Turnaround Meets a Surprise Leadership Change

A run of nine downgrades gave way to record profits and an all-time high share price, before a CEO transition landed mid-rally.

30 Sep 2026 · 5 min read

Macquarie Group broke a run of nine consecutive earnings downgrades in 2026 and rallied to all-time highs as all four of its divisions fired at once, only to surprise the market in July with news that long-serving chief executive Shemara Wikramanayake will hand over to Greg Ward in November. Fund managers now broadly agree the turnaround is real. Where they disagree is whether the re-rating that followed it still has room to run.

Breaking a run of downgrades

Yarra Capital Management pointed to the sale of Macquarie's UK meters business as a key turning point, de-risking the second-half FY26 result, alongside more favourable conditions in the commodities business following energy market disruption tied to the US-Iran conflict. After a series of downgrades, Yarra said Macquarie appeared to have found a more solid base from which to grow earnings. Vinva Investment Management reported FY26 results showing a record second-half profit, driven by surging Commodities and Global Markets earnings and major asset sale gains, pushing the shares to an all-time high. ClearBridge Investments described a genuine re-acceleration in earnings after two softer years, with all four divisions growing, the Commodities and Global Markets division benefiting from the OnStream sale and stronger oil, gas and power hedging, and further support from the Nomura transaction, stronger Macquarie Asset Management performance fees, and private credit and realisation income within Macquarie Capital.

A genuinely diversified, uncorrelated income mix

Several managers pointed to the diversity of Macquarie's earnings as the real attraction, not any single division. Plato Investment Management noted the banking arm is taking market share from the majors, with home loan growth running near 28 percent, while the commodities trading business benefits directly from volatility it does not expect to fade any time soon, and infrastructure asset sales are generating performance fees it expects to continue for a couple more years. Investors Mutual Limited broke down the mix further: roughly 48 percent of operating income is recurring, from banking and asset management, about 28 percent comes from commodities and global markets, and 24 percent from Macquarie Capital, income streams it considers largely uncorrelated with each other and less exposed to a struggling housing market than the major banks.

These are very uncorrelated streams of income, some directly benefit from volatility in markets, particularly energy markets.

— Investors Mutual Limited, Interview, July 2026

Quest Asset Partners bought into a dip in April when the stock sold off on concerns about private credit exposure, citing Macquarie's long record of prudent capital allocation and the resilient, annuity-style earnings of its asset management arm, and arguing its cost and technology advantage will keep driving market share gains in a difficult environment. L1 Capital made a similar point about competitive positioning, describing Macquarie as an aggressive and capable competitor taking share from the big four banks through an efficient mortgage broker proposition.

Some think the re-rating has gone far enough

Not every manager is comfortable chasing the rally. Yarra Capital Management remained underweight even after acknowledging the improved earnings base, viewing a 19 times FY27 earnings multiple as full given still-low earnings visibility. ClearBridge Investments trimmed its position after strong performance, consistent with what it described as a disciplined approach to reducing holdings as they approach fair value. Wilson Asset Management went further in July, turning what it called a purely tactical sell on valuation grounds, noting the business had strung together nine downgrades before finally beating expectations, and expecting management to guide cautiously at the upcoming annual meeting given that recent history.

Fundamentally, the business is going well. So it's a tactical sell. I'd like to buy at 220, 230, be very happy, but at 257, 258 I think it's a sell.

— Wilson Asset Management, Interview, July 2026

A surprise CEO transition lands mid-rally

Pendal Group described the July announcement that Shemara Wikramanayake would retire after eight years in the role, to be succeeded by Greg Ward, head of the banking division and a former chief financial officer, as a surprise in its timing, since the board had previously signalled the chair would transition before a new chief executive was chosen. Pendal views Ward as a safe pair of hands whose appointment likely reduces the near-term chance of a major private equity approach, while flagging longer-term uncertainty around the next generation of leadership and strategic direction.

Hyperion Asset Management's read of the accompanying first-quarter trading update described conditions as satisfactory, with Macquarie Asset Management's profit contribution down following the divestment of its North American and European public investments business, banking profit up on loan and deposit volume growth partly offset by margin pressure, commodities profit substantially higher on stronger trading and asset finance income, and Macquarie Capital profit up on investment and brokerage income. The group maintained its FY27 outlook but added caution around the banking division given the impact of federal budget changes on the residential property market, and confirmed Ben Perham, current head of personal banking, will take over as head of banking and financial services alongside Ward's promotion, both changes Hyperion views as high quality appointments.

What happens next looks likely to hinge on whether Macquarie's newly diversified earnings base keeps delivering surprises large enough to justify its multiple, whether commodities trading income holds up if market volatility fades, and how smoothly the leadership handover to Ward in November proceeds. For now, the split between fund managers who see room for further earnings growth and those who think the price has simply run ahead of it looks set to continue into the annual meeting season.