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Franklin’s (BEN) August AUM Down on Lower Equity Assets


Franklin Resources Inc. BEN announced preliminary assets under management (AUM) by its subsidiaries of $747.4 billion for August 2017. Results displayed around 1% fall from $752.7 billion recorded as of Jul 31, 2017. However, the figure inched up around 1% from the prior-year quarter.

Month-end total equity assets came in at $313.8 billion, down 1.7% from the prior month, but up 2.5% year over year. Of the total equity assets, around 66.2% were from international sources, while the remaining 33.8% came from the United States.

Total fixed income assets were $286 billion, marginally up from the previous month, but down 1.4% from $290.2 billion recorded in August 2016. Overall, tax-free assets accounted for only 25% of the fixed income assets, while the remaining 75% was taxable.

Franklin recorded $141.5 billion in hybrid assets, which was down around 1% from $142.5 billion recorded in the prior month, but up 2.7% from $137.8 billion recorded in August 2016.

Cash management funds were reported at $6.1 billion, in line with the prior month, as well as the year-ago period.

Though the company’s global presence helps it diversify its AUM, regulatory restrictions and sluggish economic recovery might impair growth and escalate costs. Moreover, Franklin is subject to numerous regulations by the U.S. and non-U.S. regulators, which pose concerns to its operations, and may even hurt the company’s profitability.

Franklin currently carries a Zacks Rank #3 (Hold). Shares of the company have gained 5.4% so far, this year, underperforming 15.1% growth recorded by the industry it belongs to.

Among others, Och-Ziff Capital Management Group LLC OZM, sporting a Zacks Rank #1 (Strong Buy), is worth considering. The company’s shares gained over 14% in six months’ time. The Zacks Consensus Estimate for the stock moved up around 53.3% to 46 cents, over the last 60 days, for 2017.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Among other asset managers, Invesco Ltd. IVZ and Legg Mason Inc. LM are expected to release preliminary AUM results for August 2017, later this week.

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