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Franklin's November AUM Falls on Lower Fixed Income Assets

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Franklin Resources Inc. (BEN - Free Report) announced preliminary assets under management (AUM) by its subsidiaries of $714.4 billion for Nov 2016. This is down roughly 1.2% from $723.0 billion as of Oct 31, 2016 and nearly 9.6% from $790.0 billion as of Nov 30, 2015.

The month-end total equity assets came in at $295.7 billion, stable with the prior month and down 8.9% on a year-over-year basis. Of the total equity assets, around 66% were from international sources, while the remaining 34% were from the U.S.

Total fixed income assets were $276.6 billion, down 3.2% from the prior month and around 13% from $319.2 billion recorded in Nov 2015. Overall, tax-free assets accounted for only 26% of the fixed income assets, while the remaining 74% were taxable.

Franklin recorded $135.9 billion in hybrid assets, which increased slightly from $135.2 billion recorded in the prior month and decreased around 2.7% from $139.6 billion in Nov 2015.

Cash management funds were reported at $6.2 billion, down 1.6% sequentially and 6.1% from the year-ago quarter.

While the company’s global presence helps it diversify its AUM, regulatory restrictions and sluggish economic recovery might hurt its growth and raise costs.

Franklin currently carries a Zacks Rank #3 (Hold). The company’s stock has gained more than 14% so far this year, outperforming the 6.7% growth for the Zacks categorized Investment Management industry.



A better-ranked stock in the same space is Virtus Investment Partners, Inc. (VRTS - Free Report) , sporting a Zacks Rank #1 (Strong Buy). The company’s shares gained over 8% so far this year. The Zacks Consensus Estimate for the stock inched up 9.3% to $5.75 per share over the last 60 days for the current year.

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

Among other asset managers, Invesco Ltd. (IVZ - Free Report) and Legg Mason Inc. are yet to release their preliminary AUM for the same time period. Both the stocks carry the same Zacks Rank as Franklin.

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