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Franklin Resources
(NYSE:BEN)
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Rating:68Neutral
Price Target:
$37.00
▲(13.88% Upside)
Action:Reiterated
Date:08/01/26
The score is driven primarily by a healthier capital structure and improving operating narrative (strong flows/AUM momentum and margin expansion guidance). Offsetting these positives are materially weaker TTM cash generation and only partial profitability recovery versus prior-cycle peaks; valuation is acceptable but not clearly discounted, while technicals are supportive with price above key moving averages.
Positive Factors
Strong Balance Sheet / Low Leverage
A sharply reduced leverage profile and sizable equity base materially boost financial flexibility over the medium term. Low net debt lowers interest burden and increases capacity for disciplined buybacks, bolt-on M&A, and temporary drawdowns in AUM without threatening solvency.
Negative Factors
Weakened Cash Generation
Material deterioration in operating and free cash flow means reported earnings are not translating into cash as before. Lower cash conversion constrains reinvestment, buybacks and dividend flexibility and raises sensitivity to market shocks or shortfalls in fee realization.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong Balance Sheet / Low Leverage
A sharply reduced leverage profile and sizable equity base materially boost financial flexibility over the medium term. Low net debt lowers interest burden and increases capacity for disciplined buybacks, bolt-on M&A, and temporary drawdowns in AUM without threatening solvency.
Read all positive factors
Franklin Resources Key Performance Indicators (KPIs)
Any
Revenue by Segment
Highlights income from different business units, revealing which areas drive growth and profitability, and where strategic shifts may be needed.
Highlights income from different business units, revealing which areas drive growth and profitability, and where strategic shifts may be needed.
Data provided by:
The Fly
The FlyFranklin Resources (BEN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$17.59B
Dividend Yield3.87%
Average Volume (3M)4.22M
Price to Earnings (P/E)22.6
Beta (1Y)1.07
Revenue Growth8.39%
EPS Growth181.11%
CountryUS
Employees9,800
SectorFinancial
Sector Strength70
IndustryAsset Management
Share Statistics
EPS (TTM)1.50
Shares Outstanding519,637,150
10 Day Avg. Volume4,023,370
30 Day Avg. Volume4,220,628
Financial Highlights & Ratios
PEG Ratio3.60
Price to Book (P/B)0.99
Price to Sales (P/S)1.36
P/FCF Ratio13.05
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$36.00Price Target Upside10.80% Upside
Rating ConsensusHold
Number of Analyst Covering7
EPS Forecast (FY)2.81
Revenue Forecast (FY)$7.10B
Franklin Resources Business Overview & Revenue Model
Company Description
Franklin Resources, Inc. is a publicly owned asset investment manager. Through its subsidiaries, the firm provides its services to individuals, institutions, pension plans, trusts, and partnerships. It launches equity, fixed income, balanced, and ...
How the Company Makes Money
Franklin Resources primarily makes money by charging fees for managing client assets. The core revenue stream is investment management fees, typically calculated as a percentage of average assets under management (AUM); fee levels vary by product ...
Franklin Resources Earnings Call Summary
Earnings Call Date:Apr 28, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 03, 2026
Earnings Call Sentiment Positive
The call presented a strongly positive operational and commercial performance narrative: robust diversified long-term net inflows, exceptional alternatives and ETF momentum, improving investment performance, and margin expansion potential supported by disciplined expense guidance. Notable headwinds included equity and modest fixed income outflows, elevated near-term fundraising and AI investment expenses, and some timing/visibility risk around fee recognition in alternatives and regulatory/tax uncertainties. On balance, the positive growth, fundraising, AUM gains, and improving profitability outlook materially outweigh the listed challenges.Positive Updates
Strong long-term net flows
Recorded $16.9 billion in long-term net inflows this quarter; long-term inflows of $118 billion were up 28% quarter-over-quarter and 38% year-over-year (excluding reinvested distributions).
Negative Updates
Equity and fixed income outflows
Equities experienced net outflows of $4.7 billion this quarter; fixed income saw approximately $300 million of net outflows (though excluding Western, fixed income flows were +$3.6 billion).
Read all updates
Q2-2026 Updates
Positive
Negative
Strong long-term net flows
Recorded $16.9 billion in long-term net inflows this quarter; long-term inflows of $118 billion were up 28% quarter-over-quarter and 38% year-over-year (excluding reinvested distributions).
Read all positive updates
Company Guidance
The company guided Q3 to an effective fee rate in the “mid‑to‑high 37s,” with compensation of $830M (assuming a $50M performance fee at a 55% payout), IS&T of $155M, occupancy of $70M, and G&A of $210–215M (including $23–25M of fundraising-related expense and $9–10M of incremental advertising/marketing). The full‑year outlook assumes flat markets from here and excludes performance fees, incorporates the announced voluntary buyout, and expectsFY‑end expenses roughly in line with or about 1.5% above fiscal 2025 (ex‑performance fees) while investment management fee revenue is expected to grow at least ~6% (i.e., ~4x the expense rate), implying Q4 margins in the high‑29% range and a full‑year margin in the 27% range on the way to 30%+ margins in 2027.Franklin Resources Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
78
Positive
Cash Flow
44
Neutral
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 9.32B | 8.77B | 8.48B | 7.85B | 8.28B | 8.43B |
| Gross Profit | 6.31B | 7.05B | 6.79B | 6.35B | 6.85B | 7.00B |
| EBITDA | 1.69B | 1.41B | 1.38B | 1.91B | 2.21B | 2.84B |
| Net Income | 891.20M | 524.90M | 464.80M | 882.80M | 1.29B | 1.83B |
Balance Sheet | ||||||
| Total Assets | 36.24B | 32.37B | 32.46B | 30.12B | 28.06B | 24.17B |
| Cash, Cash Equivalents and Short-Term Investments | 2.67B | 3.57B | 4.41B | 4.40B | 4.78B | 4.65B |
| Total Debt | 974.60M | 13.30B | 13.09B | 11.75B | 9.36B | 7.59B |
| Total Liabilities | 21.84B | 18.18B | 17.90B | 16.55B | 14.24B | 11.42B |
| Stockholders Equity | 11.74B | 12.08B | 12.51B | 11.92B | 11.47B | 11.22B |
Cash Flow | ||||||
| Free Cash Flow | 223.30M | 911.60M | 794.20M | 940.40M | 1.87B | 1.17B |
| Operating Cash Flow | 269.50M | 1.07B | 971.30M | 1.09B | 1.96B | 1.25B |
| Investing Cash Flow | -3.29B | -2.34B | -2.42B | -3.61B | -3.33B | -2.62B |
| Financing Cash Flow | 2.86B | 452.40M | 1.42B | 2.11B | 1.58B | 2.03B |
Franklin Resources Risk Analysis
Franklin Resources disclosed 31 risk factors in its most recent earnings report. Franklin Resources reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Franklin Resources Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
85 Outperform | $12.36B | 17.76 | 28.86% | 1.05% | 11.21% | 6.93% | |
72 Outperform | $4.91B | 14.84 | 29.51% | 2.67% | 6.46% | 9.92% | |
68 Neutral | $17.59B | 22.57 | 7.42% | 4.03% | 8.39% | 181.11% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $13.12B | -43.53 | -0.51% | 2.82% | 14.49% | -173.65% | |
61 Neutral | $4.60B | 5.43 | 5.33% | 16.08% | 134.47% | -36.39% | |
54 Neutral | $5.29B | -6.45 | 245.82% | 3.41% | 69.89% | -184.51% |
* Financial Sector Average
BEN
Franklin Resources
33.86
10.00
41.92%
IVZ
Invesco
29.60
9.31
45.89%
SEIC
SEI Investments Company
102.98
15.69
17.98%
HLNE
Hamilton Lane
88.91
-58.94
-39.87%
STEP
StepStone Group
43.86
-12.29
-21.89%
OTF
Blue Owl Technology Finance Corp.
9.94
-3.25
-24.65%
Franklin Resources Corporate Events
Business Operations and StrategyFinancial Disclosures
Franklin Resources Rebrands as Franklin Templeton, Inc.
Positive
Jul 31, 2026
Effective August 17, 2026, Franklin Resources will change its corporate name to Franklin Templeton, Inc., updating its Delaware corporate records and bylaws solely to reflect the new name, with no impact on shareholder voting or other rights. The ...
Business Operations and StrategyPrivate Placements and Financing
Franklin Resources Expands and Extends Revolving Credit Facility
Positive
Jul 30, 2026
On July 30, 2026, Franklin Resources entered into a Second Amended and Restated Credit Agreement, replacing its prior revolving credit facility with Bank of America and other lenders. The new agreement increases aggregate commitments to a $1.5 bil...
Business Operations and StrategyExecutive/Board Changes
Franklin Resources Grants Special Equity Awards to Executives
Positive
Jul 23, 2026
Effective July 21, 2026, Franklin Resources’ board approved one-time special equity retention awards for CEO Jennifer M. Johnson and three Co-Presidents, alongside carry interest allocations for the CEO and Executive Chairman Gregory E. John...
Business Operations and StrategyLegal Proceedings
Franklin’s Western Asset Resolves SEC Probe, Ends Legal Overhang
Positive
Jun 5, 2026
On June 4, 2026, Western Asset Management reached a settlement with the U.S. Securities and Exchange Commission over alleged trade allocation violations involving former co-Chief Investment Officer Ken Leech, agreeing to pay a $100 million civil p...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.