Deutsche Bank Retains Hold Rating On Franklin Resources

According to Deutsche Bank, Franklin Resources BEN held a management meeting. Deutsche Bank said that while most trends at Franklin are favorable (healthy flows & cash levels) and the firm is well positioned given its product, distribution, geographic, long-term performance, and balance sheet positioning, due to some short term performance issues/concentrated flows, and limited margin upside, its rating is Hold. “Our price target is $145 based on a target PE multiple of ~15x ex cash our CY2012E. Downside risks include worsening performance, negative FX moves, outflows, fee pressure, higher taxes, securitization markets/further impairments, add'l regulation, & unforeseen litigation; while upside risks include strong mkts, healthy flows, improving short term performance, a weak dollar, and accretive cash use.” Franklin Resources closed yesterday at $123.36.