Nomura Securities Maintains a 'Neutral' on Franklin Resources (BEN); Good, But Not Great

Nomura Securities maintains a 'Neutral' on Franklin Resources (NYSE: BEN) price target of $125.00.

Analyst, Glenn Schorr, said, "BEN reported a good but not great quarter, with strong asset appreciation, higher gross sales, and decent net inflows. The beat was driven primarily by $82.4M investment income, which more than offset higher-than-expected expenses. Operating margins fell 290 bps q/q to 34.3%, resulting in negative operating leverage, despite a strong market backdrop. Franklin is still solid, but we think that, as with the other asset managers that reported, investors were somewhat disappointed in the negative operating leverage, declining margins, and decent, but not great organic growth. We tweak our 2012/13 estimates for lower market gains, greater mix shift to fixed income and hybrid, and higher sales & distribution expenses. Our FY13/CY13 estimate decreases to $10.17/$10.42."

For an analyst ratings summary and ratings history on Franklin Resources click here. For more ratings news on Franklin Resources click here.

Shares of Franklin Resources closed at $121.74 yesterday.

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