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Franklin Resources, Inc. (BEN), headquartered in San Mateo, California, is a global investment management firm serving clients in over 150 countries. Valued at $10.3 billion by market cap, the company offers a wide range of services across equity, fixed income, alternative investments, and multi-asset strategies and manages over $1.6 trillion in assets. The leading investment manager is expected to announce its fiscal first-quarter earnings for 2025 on Monday, Feb. 3.
Ahead of the event, analysts expect BEN to report a profit of $0.56 per share on a diluted basis, down 13.9% from $0.65 per share in the year-ago quarter. The company beat the consensus estimates in two of the last four quarters while missing the forecast on two other occasions.
For the full year, analysts expect BEN to report EPS of $2.43, up 1.7% from $2.39 in fiscal 2024. Its EPS is expected to rise 7.8% year over year to $2.62 in fiscal 2026.
BEN stock has considerably underperformed the S&P 500’s ($SPX) 25.8% gains over the past 52 weeks, with shares down 31.7% during this period. Similarly, it underperformed the Financial Select Sector SPDR Fund’s (XLF)28% gains over the same time frame.
BEN’s underperformance can be due to an ongoing investigation by the SEC and DOJ into its subsidiary, Western Asset Management, alleging that the firm engaged in cherry-picking profitable trades for favored clients, damaging its reputation. Additionally, rising operating expenses, shifting market preferences, and intensified competition within the investment management industry have also impacted its performance.
On Nov. 4, BEN shares closed down more than 3% after reporting its Q4 results. Its adjusted EPS of $0.59 missed Wall Street expectations of $0.60. The company’s revenue was $2.2 billion, exceeding Wall Street forecasts of $2.1 billion.
Analysts’ consensus opinion on BEN stock is moderately bearish, with a “Moderate Sell” rating overall. Out of 14 analysts covering the stock, eight give a “Hold” rating, two suggest a “Moderate Sell,” and four recommend a “Strong Sell.” BEN's average analyst price target is $20.39, indicating a potential upside of 3.3% from the current levels.
