Jefferies: BEN Shares Are Fairly Valued

Franklin Resources, Inc. BEN reported Jan 31st total AUM of $681.0B, up $10.3B or 1.5% from Dec 31, Jefferies reports. “We had estimated AUM of $682.0B. Equity assets increased by 1.6% to $300.8B, hybrid by 2.5% to $108.8B, and fixed income by 0.8% to $264.0B. This compares to total returns of 2.4% each by the S&P 500 and MSCI EAFE, and relatively flat performance of 0.12% by the Barclays US Aggregate Bond Index. “Overall, we believe the AUM increase reflects a combination of net positive performance (~$6B), favorable currency impacts (~$2B), equity outflows (~$2B), and fixed income (~$2.5B) and money market (~$1B) inflows.” Jefferies added that BEN's global bond fund continues to gather assets at an industry leading pace. “Offsetting these inflows somewhat during the month were outflows in municipals as well as international equity,” Jefferies continues. “At ~15x our 2011 EPS estimate, we view the shares as fairly valued.” Franklin Resources closed Tuesday at $126.61.