Franklin Resources reports Q2 earnings, revenue exceeds expectations

Franklin Resources reported second-quarter earnings per share of $0.47, matching or slightly missing analyst expectations, while revenue of $2.11 billion exceeded most forecasts but was down slightly year-over-year. The company’s assets under management declined 2% from the previous quarter to $1.54 trillion due to $26.2 billion in long-term net outflows, although some business units, such as ETFs and alternative investments, showed strong inflows and growth. Operating expenses fell year-over-year, and net income on a GAAP basis rose nearly 22%. Despite mixed results, shares rose following the report, buoyed by positive trends in specific segments like ETFs, which saw their 14th consecutive quarter of net inflows, and a record institutional pipeline. The average analyst recommendation for the stock is "Hold," with one-year price targets suggesting limited upside from current levels. Overall, while Franklin Resources faces asset outflows and lower earnings compared to last year, it continues to see momentum in key growth areas.