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Franklin's (BEN) April AUM Dips 1.4% on Unfavorable Markets

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Franklin Resources, Inc. (BEN - Free Report) reported a preliminary assets under management (AUM) balance of $1,455.8 billion for April 2022. This reflects a 1.4% decrease from $1,477.5 billion recorded as of Mar 31, 2022.

Last month's decline in AUM was primarily due to the negative impacts of markets and long-term net flows, partially offset by the buyout of Lexington Partners, which was completed in April.

Total fixed-income assets were $562.8 billion, down 5.4% from the March 2022 reading. Month-end equity assets of $468.1 billion declined 9.2% from the previous month’s level. Franklin recorded $144.1 billion in multi-asset class, down 5.1% from the prior month’s level.

Nonetheless, alternative assets aggregated $218.8 billion, up 38.6% from the prior month’s level. Cash-management funds totaled $62 billion, up 8.2% sequentially.

Franklin seems well-poised for growth on the back of a robust foothold in the global market and acquisition moves. In April, Franklin completed its previously announced acquisition of Lexington Partners.

The deal helped Franklin significantly boost its alternative asset offerings by adding more than $200 billion in aggregate alternative AUM. Also, the strategic acquisition fulfills Franklin’s priority of growing its share in the private market business, as investors are allocating more capital across the full spectrum of alternative investment offerings.

However, any decline in investment management fees due to market fluctuations and adverse foreign-exchange translations remain key concerns for Franklin. A strict global regulatory environment is another headwind.

Shares of Franklin have dipped 25% in the past year compared with the 28.7% decline of the industry.

 

Zacks Investment Research
Image Source: Zacks Investment Research

 

Currently, BEN carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Competitive Landscape

Among other asset managers, Lazard (LAZ - Free Report) and T. Rowe Price (TROW - Free Report) are expected to release preliminary AUM results for April in the coming days. Over the past year, shares of LAZ have lost 26.3%, whereas the TROW stock has declined 33.5%.

At present, LAZ carries a Zacks Rank #4 (Sell), whereas T. Rowe Price has a Zacks Rank of 3 (Hold).