Franklin Resources (BEN) AI Stock Analysis

• Market Cap: $13.32B
• Dividend Yield: 4.95%
• Average Volume (3M): 3.80M
• Price to Earnings (P/E): 49.2
• Beta (1Y): 0.98
• Revenue Growth: 4.72%
• EPS Growth: -67.85%
• Country: US
• Employees: 10,000
• Sector: Financial
• Sector Strength: 78
• Industry: Asset Management
• EPS (TTM): 0.49
• Shares Outstanding: 519,195,500
• 10 Day Avg. Volume: 3,068,142
• 30 Day Avg. Volume: 3,804,560
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.79
• Enterprise Value/Revenue: 2.76
• Enterprise Value/Gross Profit: 3.45
• Enterprise Value/Ebitda: 21.17
• 1Y Price Target: $25.38
• Price Target Upside: -1.09% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 8

• Rating: 76 Outperform
• Price Target: $29.00 ▲(13.02% Upside)

Franklin Resources' strong financial health and positive earnings call sentiment are the most significant factors driving the score. The company's robust cash flow management and global presence are key strengths. However, the high P/E ratio and challenges with profitability and outflows at Western Asset Management present risks.

Positive Factors

Financial Performance

Raising EPS estimates and price target shows a favorable outlook for BEN.

Growth Potential

Private markets fundraising rose significantly in F2Q, indicating strong growth potential.

Market Position

BEN's solid positioning among traditional managers in private asset/alt products was well received.

Negative Factors

Investment Recommendation

The recommendation remains underweight despite better management fees.

Market Performance

The shares have already outperformed in the recent market drawdown, limiting immediate upside potential.

Operating Expenses

Lowering adjusted EPS due to higher operating expenses, partially offset by better revenues.

Franklin Resources Business Overview & Revenue Model

Company Description

Franklin Resources, Inc. is a publicly owned asset management holding company. Through its subsidiaries, the firm provides its services to individuals, institutions, pension plans, trusts, and partnerships. It launches equity, fixed income, balanced, and multi-asset mutual funds through its subsidiaries. The firm invests in the public equity, fixed income, and alternative markets. Franklin Resources, Inc. was founded in 1947 and is based in San Mateo, California with an additional office in Hyderabad, India.

How the Company Makes Money

Franklin Resources generates revenue primarily through management fees charged on the assets it manages across its investment funds and accounts. These fees are typically based on a percentage of assets under management (AUM) and vary by fund type and investment strategy. Additionally, the company earns performance fees from certain funds that exceed predefined benchmarks. Other revenue streams include distribution fees and investment advisory services provided to institutional clients. The company also benefits from partnerships with financial intermediaries, such as broker-dealers and financial advisors, which help distribute its investment products to a broader audience, thereby increasing AUM and, subsequently, management fees.

Franklin Resources Financial Statement Overview

Summary

Franklin Resources demonstrates strong financial health with solid revenue growth and efficient cash flow management. The company maintains a low leverage with a debt-to-equity ratio of 0.08, and a significant free cash flow growth rate of 82.8% in TTM. However, challenges with decreasing net profit margins and a modest ROE of 2.64% indicate room for improvement in profitability.

Income Statement

The company has shown consistent revenue growth with a TTM revenue of $8.64 billion compared to $8.48 billion in the previous year. However, the net profit margin has decreased from 5.48% to 3.73% over the same period, indicating pressure on profitability. The EBIT margin improved to 8.77% in TTM, reflecting operational efficiency gains.

Balance Sheet

Franklin Resources maintains a solid balance sheet with a debt-to-equity ratio of 0.08 in TTM, indicating low leverage. The equity ratio stands strong at 37.5%, showcasing stability. The return on equity (ROE) is a modest 2.64%, highlighting room for improvement in generating shareholder value.

Cash Flow

The company exhibits robust cash flow management with a significant free cash flow growth rate of 82.8% in TTM. The operating cash flow to net income ratio is 5.1, indicating strong cash generation relative to net earnings, which is a positive indicator of financial health.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	8.64B	8.48B	7.85B	8.28B	8.43B	5.57B
Gross Profit	6.90B	6.79B	6.35B	6.85B	7.00B	4.50B
EBITDA	1.13B	1.38B	1.91B	2.21B	2.84B	1.18B
Net Income	309.30M	464.80M	882.80M	1.29B	1.83B	798.90M
Balance Sheet
Total Assets	32.55B	32.46B	30.12B	28.06B	24.17B	21.68B
Cash, Cash Equivalents and Short-Term Investments	3.96B	4.41B	4.40B	4.78B	4.65B	3.99B
Total Debt	13.25B	13.09B	11.75B	9.36B	7.59B	6.44B
Total Liabilities	18.12B	17.90B	16.55B	14.24B	11.42B	10.27B
Stockholders Equity	12.20B	12.51B	11.92B	11.47B	11.22B	10.11B
Cash Flow
Free Cash Flow	1.45B	794.20M	989.90M	1.87B	1.17B	917.70M
Operating Cash Flow	1.65B	971.30M	1.14B	1.96B	1.25B	1.02B
Investing Cash Flow	-3.10B	-2.42B	-3.58B	-3.33B	-2.62B	-3.24B
Financing Cash Flow	909.20M	1.42B	2.03B	1.58B	2.03B	734.40M

Franklin Resources Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 25.66
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BEN, the sentiment is Positive. The current price of 25.66 is above the 20-day moving average (MA) of 25.26, above the 50-day MA of 24.64, and above the 200-day MA of 21.11, indicating a bullish trend. The MACD of 0.28 indicates Negative momentum. The RSI at 59.86 is Neutral, neither overbought nor oversold. The STOCH value of 88.61 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BEN.

Franklin Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SEIC	77 Outperform	$10.91B	16.58	30.06%	1.11%	10.55%	40.74%
BEN	76 Outperform	$13.32B	49.20	2.16%	4.95%	4.72%	-67.85%
IVZ	74 Outperform	$9.76B	23.51	5.74%	3.79%	6.79%	―
HLNE	74 Outperform	$8.59B	29.67	32.03%	1.30%	10.66%	22.13%
Sector *	68 Neutral	$17.90B	11.86	10.29%	3.72%	9.74%	1.66%
STEP	60 Neutral	$7.33B	103.13	-88.82%	2.26%	88.68%	-494.20%
OTF	―	$6.96B	8.23	8.70%	2.35%	―	―

Franklin Resources Corporate Events

Franklin Resources Reports Q3 2025 Earnings Decline

Franklin Resources, Inc. reported a net income of $92.3 million for the third quarter ending June 30, 2025, a decrease from $151.4 million in the previous quarter and $174.0 million in the same quarter last year. Despite the decline in net income, the company highlighted progress in asset classes and investment vehicles, with long-term net outflows improving and strong growth in alternative asset fundraising, ETFs, and international markets. The acquisition of a majority interest in Apera Asset Management is expected to enhance the company’s private credit capabilities in Europe, reflecting its commitment to expanding its global alternatives platform.

Franklin Resources Designates Delaware Court for Legal Actions

On July 8, 2025, Franklin Resources‘ Board of Directors approved amendments to the company’s Bylaws, introducing a new section that designates the Court of Chancery of the State of Delaware as the exclusive forum for certain legal actions involving the company and its affiliates. This strategic move is aimed at centralizing legal proceedings to a single jurisdiction, potentially streamlining legal processes and reducing litigation costs for the company.