Franklin Resources posted a quarter that exceeded Wall Street’s expectations, with the market reacting positively to the company's reported results. Management attributed this performance to broad-based net inflows across public and private markets, record asset under management in several business lines, and continued momentum in vehicles like ETFs and separately managed accounts. CEO Jenny Johnson highlighted the firm’s ability to meet evolving client needs for diversified, long-term investment solutions, noting strong client engagement across geographies and asset classes as a major contributor to this quarter’s outcome.

Is now the time to buy BEN? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Franklin Resources’s Q4 Earnings Call

• Bill Katz (TD Cowen) asked about expense flexibility if markets decline and the status of cost savings. CFO Matt Nicholls detailed that remaining cost reductions will be recognized mostly later in the year, with margin expansion expected in the third and fourth quarters.
• Craig Siegenthaler (Bank of America) inquired about M&A priorities and contingent liabilities. CEO Jenny Johnson clarified that future M&A will focus on bolt-on capabilities, distribution enhancements, and high net worth channel growth, with little remaining contingent consideration from past deals.
• Brennan Hawken (BMO Capital Markets) questioned expectations for fee rates and fundraising trends. CFO Matt Nicholls indicated that alternative asset fundraising is expected to be stable in the near term, with possible upside in later quarters as new funds launch.
• Alex Blostein (Goldman Sachs) pressed for long-term operating margin targets. Nicholls set a goal of exceeding 30% margin by 2027, contingent on successful integration and continued growth, while noting that current support for recently acquired businesses temporarily depresses margins.
• Glenn Schorr (Evercore) asked about the shift from product sales to integrated solutions in both institutional and wealth channels. CEO Johnson explained that clients are consolidating relationships and seeking managers with broad capabilities and expertise across public and private markets.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will track (1) further growth and client adoption in private credit and perpetual alternatives funds, (2) progress on integration and technology-driven cost savings, especially from AI-driven distribution and blockchain initiatives, and (3) the impact of scaled ETF and custom indexing platforms on overall fee rates and profitability. Additional milestones include monitoring fundraising in Lexington Partners’ flagship funds and the continued stabilization of flows at Western Asset.

Franklin Resources currently trades at $27.08, up from $25.88 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).

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